(Reuters) -International index supplier Russell mentioned on Tuesday it could embody India’s sovereign bonds in its Rising Markets Authorities Bond Index (EMGBI) from September 2025, after index inclusion by JP Morgan and Bloomberg Index Companies, probably drawing billions of {dollars} into native bonds.
The London-based index supplier additionally added South Korean authorities bonds to the FTSE World Authorities Bond Index (WGBI) after two years on its watch listing.
South Korean authorities bonds would signify 2.22% of the index on a market value-weighted foundation and can be included within the FTSE’s WGBI starting in November 2025, FTSE mentioned in a press release.
Indian securities shall be part of FTSE’s EMGBI after being on the index supplier’s watch listing for the final three years. It will signify 9.35% of the index on a market-value weighted foundation, FTSE mentioned.
The market worth of the EMGBI is $4.7 trillion, in line with the FTSE launch.
“The choice is a sentiment optimistic and can strengthen the demand aspect of India bonds structurally,” mentioned Madhavi Arora, chief economist at Emkay International Monetary Companies.
Indian bonds have seen overseas inflows of practically $18.5 billion for the reason that announcement of inclusion into JPMorgan Rising Market index in September 2023.
In a March evaluate, FTSE had deferred inclusion of Indian bonds in its index because of taxation, registration and settlement points however acknowledged India’s progress within the accessibility of the securities.
FTSE’s announcement follows inclusion of Indian authorities securities in JPMorgan’s Authorities Bond Index-Rising Markets index beginning in June 2024 and Bloomberg Index Companies’ Rising Market Native Forex beginning in January 2025.
