India will be included in JPMorgan’s emerging-markets bond index

India will be included in JPMorgan's index of bonds from emerging markets


JPMorgan Chase & Co. will start including Indian government bonds in its benchmark emerging-market index on June 28 in 2024, which is a significant development that could attract foreign capital to India’s debt market. The Indian government’s introduction of the “FAR program in 2020 and substantive market reforms for aiding foreign portfolio investments” led to the index’s inclusion, according to a statement released on Thursday by the American multinational investment bank JP Morgan.

Given that India’s economy is still among the fastest-growing major economies, its inclusion in the JPMorgan Government Bond Index-Emerging Markets index may be seen as yet another indication of its growing appeal to international investors. This development is important, especially in light of the fact that several global manufacturing behemoths are considering setting up shop in India as part of their China+1 diversification strategy in a post-pandemic world. India is anticipated to have a maximum weight of 10% in JP Morgan’s Government Bond Index-Emerging Markets, the bank said on Thursday.

“Inclusion of the IGBs will be staggered over a 10-month period starting June 28, 2024, through March 31, 2025 (i.e., inclusion of 1 per cent weight per month),” JP Morgan added.
Currently, as many as 23 Indian government bonds with a combined notional value of USD 330 billion are index-eligible.