Facts for Prelims (FFP)
Source: IE
Context: JP Morgan Chase & Co. has announced the inclusion of Indian government bonds into its emerging markets bond index, effective from June 2024.
- This move is expected to attract approximately $25 billion in foreign investment into India’s domestic government securities market.
Significance:
- India will reach a maximum weight of 10 per cent in the GBI-EM Global Diversified Index (GBI-EM GD) as part of the inclusion.
- Analysts estimate that the inclusion could result in nearly $26 billion in passive inflows, with the potential for additional active flows of around $10 billion, bringing the total inflows to approximately $40 billion over the next one and a half years.
