Budget 2024: Last 10 years bond market (Bond Market) have been very important for. Market volume has increased. The number of retail participants has also increased. In the last 10 years, the growth of the outstanding amount of Government Securities (G-Sec) and corporate bonds has been 165 percent. The outstanding amount of corporate bonds has increased from Rs 16.49 lakh crore to Rs 44.16 lakh crore. The outstanding amount of government securities has increased from Rs 5.79 lakh crore to Rs 15.43 lakh crore. During this rbi And SEBI has taken several steps to increase retail participation in the bond market. These include the announcement in the Budget 2020-21 to allow foreign investors to invest in certain government securities without any limit. Tax-free infrastructure bonds were announced in the Budget 2015-16 for road, rail and irrigation projects.
Infrastructure and launch of green bonds
In the Budget 2023-24, it was announced to give incentives to cities improving their creditworthiness for issuing municipal bonds. Infrastructure and green bonds launched between 2021 and 2023. In the last 10 years, announcements related to bonds in many budgets have helped in strengthening the bond market. Retail participation has increased in this market. Experts say that the government wants to increase retail participation in the bond market. For this, continuous measures are being taken at the level of government and regulators.
Infrastructure debt fund announced
In the Union Budget 2016, the government had announced tax-free infrastructure bonds for road, rail and irrigation. Experts say that these bonds are quite safe. These non-convertible debentures are issued by government institutions. These are issued to raise money for projects in the infrastructure related sector. Individual and institutional investors are allowed to invest in these. The government had announced Infrastructure Debt Fund in the Union Budget 2022. Its objective was to attract foreign investment in the infrastructure sector.
Permission to invest in A rated bonds
In the Union Budget 2018, the Finance Minister had requested the regulators to allow investing in bonds with 'A' rating instead of 'AA'. The Finance Minister had also said that the government will create a unified authority for regulation of all IFSC based financial services. The objective of IFSC is to bring to India all such services and transactions done by Indian companies which till now have been done in financial centers abroad.
NRIs allowed to invest in special government securities
The government had made a big announcement in Budget 2021 to increase the depth of the bond market. The government had opened certain types of government securities for investment by NRIs. After this RBI started a separate channel named 'Fully Accessible Route'. Through this, NRIs were allowed to invest in specific government bonds from April 1, 2020. Since then, foreign investment in bonds has increased. The recent decision to include Indian government bonds in JP Morgan's global bond index is also expected to have a big impact.
