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Informist, Friday, Jul. 31, 2026

 

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--Bloomberg Index Svcs defers India FAR bond inclusion in Global Aggregate 
--CONTEXT: Bloomberg was reviewing India bonds for index inclusion since Jan 
--Bloomberg Index Svcs: Need more time to decide on India bond inclusion 
--Bloomberg Index Svcs:India made good progress in Global Aggregate inclusion 
--Bloomberg Index Svcs: Must see more efficiency for all investors in India 
--Bloomberg Index Svcs: Investors noted hurdle in automated trading in India
--Bloomberg Index Svcs: FPIs seek better account opening, onboarding process

 

NEW DELHI – Bloomberg Index Services Ltd. deferred the inclusion of India's fully accessible route bonds on its flagship Global Aggregate Index, it said in a release Friday. India had made meaningful progress towards meeting the standards expected for inclusion but required more time for positive developments to be firmly established. Bloomberg said it would continue to review the progress of India's market access and engage with stakeholders. 

 

"...BISL (Bloomberg Index Services) believes it is appropriate that any inclusion decision be supported not only by regulatory and market structure reforms, but also by demonstrated operational efficiency across the diverse range of investors that track and benchmark against the index," the index provider said. 

 

The government and the Reserve Bank of India had made a big push for India's inclusion on the marquee index, which was expected to attract over $20 billion of inflows, by scrapping capital gains and withholding tax of foreign investment into government securities in June. India's fully accessible route bonds have no limit on foreign investor holdings. A top finance ministry official said in June the moves were to secure the index inclusion and solve the issue of deficient capital inflows.

 

The index provider noted these had reduced operational complexity and improved settlement efficiency, responding to several hurdles raised in June. Still, enhancements had not been completely reflecting in day-to-day market practice, which was essential for the flagship benchmark for global investment-grade fixed income, the release said. Automated trading capabilities had also not been fully implemented across all major investor regions, the release said. The Clearing Corp. of India had allowed global electronic trading platforms to directly quote on the RBI's bond trading interface in early 2026. 

 

"In addition, a number of respondents indicated they would like to see further evidence that recent market reforms translate into more efficient operational workflows, including improvements to account opening and onboarding processes for foreign investors," Bloomberg Index Services said.

 

Bloomberg had begun consultations with investors on India's inclusion last year but said in January it would keep the review open and ongoing, with an update by mid-2026. Since then, the index provider had engaged with markets participants and other stakeholders globally on the decision for India's inclusion. The country's bond market has made meaningful steps towards the inclusion, it said. 

 

India's fully accessible route bonds have been included in emerging market indices operated by Bloomberg, J.P. Morgan and FTSE Russell starting mid-2024. Foreign portfolio investors hold INR 3.73 trillion of index-eligible bonds, around 3% of the outstanding bonds issued by the Centre. With the deferment of the inclusion into the Global Aggregate Index, government bond yields are expected to rise sharply on Monday. The 10-year benchmark gilt yield ended at 6.83% on Friday.  End

 

US$1 = INR 95.38

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Aaryan Khanna

Edited by Akul Nishant Akhoury

 

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