India’s inclusion in global bond indices to up foreign investor interest in corp debt as well: Buch
Speaking at a research conference organised by Sebi and its education-focused capacity-building body NISM, Buch said the regulator will further reduce the minimum investment size of bets on real estate investments trusts and infrastructure investment trusts to ensure that common people are able to take bets on such assets.
“We are all delighted that now, government of India bonds will be part of the global indices,” Buch said.
“We are expecting that on the back of the inclusion of the sovereign debt on the global indices, there will be a significant interest in corporate debt,” she added.
J P Morgan and Bloomberg have included securities issued by the Indian government to take care of its funds in their indices, which is expected to lead to inflow of up to USD 40 billion into Indian debt from foreign investors.
Buch said the young generation, which is keen to spot the next best money multiplier, should look at REITS and InvITs, which help an investor take a fractional ownership in major real estate and infrastructure assets.
“The level of investor interest, particularly from foreign investors, in the InvIT space is very very significant,” she said, listing out the strategies to be deployed by Sebi to make it more popular going ahead.
The regulator is comfortable with the level of disclosures and governance standards in the instruments now, and has already decreased the minimum investment amount in such asset classes as the risk in such assets has gone down, she said.
“We have steadily brought it down and the intention, the commitment to the industry is that down the line we will bring it down even further making it very much affordable,” she said.
This is a part of the “sachetisation” of financial products strategy adopted earlier, Buch said, adding that such a move should help even the smallest of investors own a fractional ownership of such assets.
Meanwhile, speaking at the same event, Sebi’s Whole-Time Member Ananth Narayan said the regulator will be launching a survey on the level of investor awareness and what are the mediums through which they get their information.
Stating that it will take some time, he said, “This is something that we are consciously trying to do, to actually figure out scientifically on where are the gaps, how can they be addressed, what is the best medium of doing so. Its worth the exercise rather than us assuming what the investor wants.”
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