India: looking for the big bang bond effect | beyondbrics:
"What do you do if you are an emerging market country that is suffering from a widening current account deficit, has a battered currency and is pretty much being shunned by foreign investors at the moment?
Well if you are India, you can try joining an international benchmark index.
According to Reuters, India is in talks with JP Morgan Chase to join the bank’s GBI-EM local bond index. The index is tracked by almost $250bn in global funds. So inclusion into the index should result in significant capital inflows as funds that track the index add Indian debt to their holdings.
“If it happens, it will be a pretty big deal,” Denise Simon, an emerging-market fixed income manager at Lazard Asset Management, told beyondbrics."
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