Infra firms rely on banks as bond market shuns low-rated debt: PFRDA chief

PFRDA Chairman Sivasubramanian Ramann says infra firms depend on banks as bond markets avoid long-tenor, lower-rated debt, urging innovative frameworks and stronger ESG focus

Corporate bond markets are skewed towards AA-rated and above bonds with tenors under five years, pushing infrastructure companies to rely on banks and financial institutions for funding, said Sivasubramanian Ramann, chairman of Pension Fund Regulatory and Development Authority (PFRDA) on Thursday. 

 

Political, regulatory, and execution risks deter long-term investments, said Ramann. He added that many infrastructure projects are rated BBB or below, limiting access to institutional investors.

 

Bankability issues persist due to inadequate project preparation, weak risk-sharing frameworks, and limited revenue visibility, he said.

 

“Political, regulatory and execution risks discourage long-term commitments. The downside, or the flip side of expanding