Bond investors risk getting burned if India fails to enter global indices

Overseas investors are pouring into Indian bonds, putting the securities at risk of losses if a long-awaited inclusion into global indexes once again fails to take place.

Bond purchases by global funds under the so-called Fully Accessible Route jumped to 42 billion rupees ($529 million) in August, the most since January. They have already snapped  up an additional 31 billion rupees of the securities in September.

The inflows have added fuel to a bond rally driven by optimism that JPMorgan Chase & Co. will announce the inclusion of Indian debt in its emerging-markets index as early as the middle