The lure of dollar bonds

Surge in foreign borrowing poses risks

Stress in the financial system and elevated levels of non-performing assets in the banking sector appear to be pushing Indian companies to borrow from overseas. The data compiled by the Business Standard Research Bureau shows that Indian companies raised $13.74 billion through dollar bonds in the first 10 months of 2019, compared with $1.65 billion in the same period last year. This is in line with the data published by the Reserve Bank of India (RBI). The latest Monetary Policy Report, for instance, showed that the flow of funds to the commercial sector practically collapsed between April and mid-September to