India Proposes New Incentives to Boost Municipal Bond Market

The Indian government proposed fresh steps to boost the nation’s municipal bond market and encourage civic bodies to issue higher value debt as rising urban infrastructure needs weigh on the federal government’s budget.

The administration proposed an incentive of 1 billion rupees ($10.9 million) on individual bond sales of more than 10 billion rupees, Finance Minister Nirmala Sitharaman said in her budget speech on Sunday. This proposal will be in addition to the previous system, where the government provided incentives on issuances up to 2 billion rupees.