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RBI Includes 10-Year Sovereign Green Bonds in Non-Resident FAR Investment.

Banking & Finance | Dated: 23 Nov 2024

The Reserve Bank of India (RBI) has added 10-year Sovereign Green Bonds (SGrBs) to the list of specified securities for non-resident investors under the Fully Accessible Route (FAR). This move will help raise capital to fund sustainable initiatives for public sector projects.

🎯 Key Highlights:

  • - This decision follows the inclusion of Indian Government Securities (G-Secs) in JPMorgan Chase's Emerging Markets Bond Index Global Diversified (CBI-EM GD), Bloomberg's EM Local Currency Government indices, and FTSE Russell's Emerging Markets Government Bond Index (EMCBI).
  • - SGrBs will be issued by the Government of India (GoI) in the second half of the Financial Year 2024-25 (FY25). These bonds will be classified as 'specified securities' under FAR.

💡 Other Important Facts:

  • (i) The GoI plans to issue Rs. 20,000 crore in green bonds in four tranches, consisting of two 10-year bonds and two 30-year bonds, each valued at Rs. 5,000 crore.
  • (ii) The FAR, introduced in 2020, allows Foreign Portfolio Investors (FPIs), Non-Resident Indians (NRIs), and other eligible investors to buy specified government securities without investment limits.
  • (iii) The RBI has issued a total of Rs. 36,000 crore in green bonds since 2022-23.

📚 Test Your Knowledge:

Recently, which organization added 10-year Sovereign Green Bonds to Non-Resident FAR Investment?

Correct Answer: RBI

🚀 Quick Recap:

About RBI

  • CEO : Shaktikanta Das
  • Headquarters: New Delhi