Opinion | The time is right to deepen the Indian bond market
The insolvency and bankruptcy code has already armed bondholders with powers to pull up the defaulters and safeguard their interests
India’s capital market regulator has proposed that large corporations should raise 25% of their borrowings from the corporate bond market from the next fiscal year. A large corporation is one, according to the Securities and Exchange Board of India (Sebi), which has an outstanding long-term borrowing of at least ₹ 100 crore. The Reserve Bank of India (RBI) considers a company large if it has an aggregate sanctioned credit limit of ₹ 25,000 crore from the banking system (not how much it has taken) in fiscal year 2018. The amount is progressively reduced to ₹ 15,000 crore in 2019 and ₹ 10,000 crore from 2020.