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Covid-19 exposes hurdles of credit market as borrowers shun regulations

Indian policy makers have put a priority on deepening the nation's corporate bond market given the high level of bad loans at local banks

Economy, Market
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(Bloomberg)

Rahul Satija and Ayush Damani | Bloomberg
Efforts by Indian policy makers to open up rupee corporate bond sales to more investors took a step backward during the pandemic, as borrowers shunned tighter regulations in the public market in a record dash for funds.

Private bond placements, which restrict the number of investors in a deal, have long accounted for the vast majority of debt sales in India’s local-currency credit market, but they rose to 99% of all offerings this year, the most in at least a decade. A bigger public debt market should help reduce borrowing costs for issuers by increasing competition for deals, and boost

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First Published: Dec 24 2020 | 8:34 AM IST

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