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Indian and South Korean bonds are set to be included in the FTSE Russell Government Indexes starting in 2025.

Banking & Finance | Dated: 18 Oct 2024

On October 8, 2024, FTSE Russell, the London-based index provider, announced that Indian and South Korean government bonds will be included in the FTSE Russell Government Indexes in 2025, aiming to attract billions of dollars in foreign investment to their local bond markets.

🎯 Key Highlights:

  • - India's market accessibility level will be upgraded from 0 to 1, and Indian sovereign bonds will be added to the Emerging Markets Government Bond Index (EMGBI) starting September 2025.
  • - FTSE Russell is the third index provider to incorporate Indian bonds into its emerging markets category, following the successful inclusion of these bonds in JP Morgan's Government Bond Index - Emerging Markets (GBI-EM) in June 2024, and Bloomberg Index Services' Emerging Market Local Currency (EMLC) beginning January 31, 2025.
  • - FTSE Russell will include South Korean government bonds in its World Government Bond Index (WGBI) starting November 2025, constituting 2.22% of the index after two years on the watch list.

💡 Other Important Facts:

  • (i) According to FTSE, Indian bonds will account for 9.35% of the index on a market value-weighted basis, making India the second-largest component after China.
  • (ii) Since the announcement of Indian bonds' inclusion in JP Morgan's GBI-EM in September 2023, these bonds have attracted approximately USD 18.5 billion in foreign inflows.
  • (iii) As of October 2024, a total of 32 Indian government Fully Accessible Route (FAR) bonds, denominated in Indian Rupees (INR) with a cumulative outstanding par value of USD 473.8 billion, are expected to be eligible for inclusion in FTSE's EMGBI.

📚 Test Your Knowledge:

Besides India, which other country's bonds are set to be included in the FTSE Russell Government Indexes starting in 2025?

Correct Answer: South Korea

🚀 Quick Recap:

About Financial Times Stock Exchange (FTSE) Russell

  • CEO - Fiona Bassett
  • Headquarters - London