The Center is finalizing the terms of a “support facility” that will be put in place to deepen the corporate debt market, a senior government official said on Friday.
The facility, announced in the February budget, will be an entity that can trade relatively illiquid quality corporate bonds and will be readily available in times of stress to purchase those bonds from participants in the secondary market.
“We have to do a lot of work in the bond market. The government and all the main participants are in permanent dialogue to do more to develop our bond market, ”said Anand Mohan Bajaj, Deputy Secretary of the Department of Economic Affairs, during his address at the CII Financial Markets Summit.
He said the government was considering a support facility that would also be available during times of non-stress.
He stressed in another budget announcement that he had “streamlined the single code of the securities market,” and said it would be a forward-looking measure.
Speaking at the event, Senior Economic Advisor Sanjeev Sanyal said the government and the RBI are working on including Indian sovereign bonds in global bond indices and an announcement in space is expected during of the year.
“We opened up part of our public debt market to foreign players last year. Some have invested in it, but less than 50% of what has been opened, he said.