India’s inclusion in JPMorgan Chase & Co.’s bond index will benefit the country’s private credit markets as India can attract more fund flows by providing a benchmark for investment. BPEA Credit has made this estimate in a news agency report. A senior official at BPEA Credit said the inclusion is an important moment for the country’s $1.2 trillion government debt market, which will have implications for other asset classes as well. Once the changes come into effect on June 28, it will be easier to compare the performance of Indian credit funds with investments in Singapore, Korea or the US.
This gives a reference point for foreign investors who look at both sovereign and corporate bonds and other asset classes. The official said BPEA Credit, established in 2011, has invested more than Rs 1 billion in India. Investors have already poured billions of dollars into sovereign bonds eligible for inclusion in the index, which has helped push yields on corporate notes lower. This has implications for the rapidly growing market of non-bank credit.
