India set to unleash wave of debt funding

A slew of measures introduced by the Indian government to boost capital markets activity is already paying off.

India’s new government looks to unleash a fresh wave of debt funding to help meet the country’s chronic financing needs as bank lending dries up.

After the elections in May the Reserve Bank of India introduced a slew of measures to boost capital markets activity, including slashing withholding tax on bonds and relaxing capital controls.

These steps are expected to pick up the slack created by a drop in bank lending, with Tata Motors already taking advantage. The Indian group on Thursday sold a Reg-S $750 million dual tranche bond.

It is timely because loan growth slowed to 11.6% in August from 13.3%...

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