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India emphasising deepening of corporate bond market: India's envoy to Singapore

With the strength of the economy we can go more forward with the bonds and have a bigger role FPIs.

Jul 15, 2019, 06.24 PM IST
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The Indian envoy said it was the first time India had a mission vision.
India is emphasising the deepening of corporate bond market for the infrastructure sector as well as monetising and securitising infrastructure assets to provide greater role for the Foreign Portfolio Investors, India's envoy to Singapore Jawed Ashraf said on Monday.

Addressing a forum on the Indian Budget 2019-20 here, Ashraf said the slew of measures taken by the Indian government is also to increase the limit of the FPI investment to the maximum permissible foreign investment for the infrastructure sector.

"The budget has announced measures for deepening of the corporate bond market, especially for the infrastructure sector. This is in addition to the slew of measures announced for providing greater role for Foreign Portfolio Investors in India," Ashraf said at the forum organised by the Indian High Commission and PriceWaterhouseCoopers, a multinational professional services network.

Ashraf said FPIs are to be allowed to sell off their debt securities issued by Infrastructure Debt Fund - Non Banking Finance Corporations (IDF-NBFCs) to domestic investors within the specified lock-in period.

The Government has also announced several steps to strengthen the NBFCs, which are facing a number of challenges.

"Looking at what the government is doing about FPI and Sovereign Bonds, it tells us about the confidence that the government has in economic resilience and stability in India," he said.

"With the strength of the economy we can go more forward with the bonds and have a bigger role FPIs," the Indian envoy stressed.

The Government, he said, has also taken bold steps for disinvestment in Central Public Sector Enterprises, which will introduce a high degree of market discipline and accountability.

Following the 2019-20 Budget announcement, India is also set to promote Public Private Partnership (PPP) model in the massive infrastructure development across the country, said Ashraf, highlighting the investment needs of the Railways over the next 12 years and the funding gap in possible public allocation.

The budget supports Prime Minister Narendra Modi's key economic objectives, which are accelerating growth to achieve a USD 5 trillion economy by 2024, continue with fiscal prudence, focus on access, empowerment and inclusion.

It also backs the government's efforts to expand infrastructure, improve ease of doing business and ease of living, generate employment, reform economic governance, promote digital revolution, ‘formalisation' of the economy, and sustainable growth, he said.

The Indian envoy said it was the first time India had a mission vision.

"The USD 5 trillion (economy) is not just a target or an aspirational goal, it is a mission statement for the country and serves as a mobilising instrument to rally the entire economy band the public behind a common purpose. This is the first time we have a mission statement of this nature," he said.

Ashraf said the Indian economy offers huge opportunities for Singapore companies and investors, including in viable stressed assets through the financial resolution process in the Insolvency and Bankruptcy Code (IBC).

The IBC is the bankruptcy law of India which seeks to consolidate the existing framework by creating a single law for insolvency and bankruptcy.

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