Bloomberg has deferred including Indian bonds in its Global Aggregate Index. The review remains open after market participants cited operational and infrastructure concerns, with a further update on potential inclusion expected by mid-2026.
Bloomberg Index Services on Tuesday deferred the inclusion of Indian bonds in its flagship Global Aggregate Index.
Bloomberg Index Services Limited (BISL) said that it will keep its review of Indian government bonds for potential inclusion in the Bloomberg Global Aggregate Index open and ongoing, following feedback from market participants.
Market Feedback and Concerns
Support and Acknowledged Progress
BISL said respondents to its recent consultation expressed broad support for the long-term development of India's government bond market and its eventual inclusion in global investment-grade benchmarks. Market participants acknowledged progress made in recent years, particularly improvements in market accessibility and the implementation of the Fully Accessible Route (FAR), which has eased capital controls and improved investability for foreign investors.
Operational Challenges Raised
However, respondents also raised concerns around operational and market infrastructure challenges that require further assessment before inclusion in a flagship global investment-grade index. These include the lack of fully automated trading workflows, settlement and repatriation timelines linked to post-trade tax processes, and the complexity and length of fund registration procedures.
While such issues are commonly accepted by investors in emerging market strategies and have been deemed suitable for inclusion in BISL's emerging market indices, some participants noted that the Bloomberg Global Aggregate Index serves a broader and more operationally diverse investor base.
Next Steps and Future Timeline
In response, BISL said it will continue to engage with index users, market participants, custodians, regulators, and relevant authorities to assess potential improvements to market infrastructure and post-trade processes.
The index provider said it expects to provide a further update on the review by mid-2026, at which time it will outline next steps regarding potential inclusion. Any decision to include Indian government bonds would be announced well in advance, with at least a one-year gap between announcement and implementation, and inclusion likely to be phased in to ensure orderly market adjustment.
Bloomberg Index Services said it will provide an update in mid-2026. (ANI)
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