The Indian government is planning on raising $10 billion in one go via its first overseas bond sale in October, Bloomberg has reported.
India would prefer to carry out the bond sale in either Euros or Yen due to lower interest rates but may also decide on the US Dollar due to its high liquidity.
The news of this planned sale comes after Finance Minister Nirmala Sitharaman announced an offshore bond sale plan to boost domestic infrastructure spending in her maiden budget speech. Sitharaman also cited India’s low overseas debt as an argument in favour of the bond sale.
There is also a possibility of raising the funds in multiple tranches but experts feel that smaller bond size may deter potential investors. The maturity period of the overseas bond may be at least 10 years or more. The government has decided against hedging the sale as it would increase costs.