Union Budget Proposes Measures To Deepen Corporate Debt Markets

Government will work with regulators RBI/SEBI to enable stock exchanges to allow AA rated bonds as collaterals

A number of measures to further deepen bond markets have been proposed by the Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman, while presenting the Union Budget 2019-20 in Parliament today.

The Finance Minister said, “Corporate Debt markets are crucial for the infrastructure sector.  Though the number and value of bond issuances had gone up, there has been a dip in the last two years.  The market is skewed in favour of private placement”.

The Finance Minister added that given the need to further deepen bond markets, a number of measures are proposed to be taken up, which are as follows;

• To deepen the Corporate tri-party repo market in Corporate Debt securities, Government will work with regulators RBI/SEBI to enable stock exchanges to allow AA rated bonds as collaterals.
• User-friendliness of trading platforms for corporate bonds will be reviewed, including issues arising-out of capping of ISINs.