Will India Inc be forced to break its new found addiction to overseas debt markets? Rebecca Abraham investigates recent bond issues to find out
Over the past year several Indian companies of varied strength and promise have successfully tapped overseas debt markets. In November 2014, Mint reported that “almost 10” companies with sub-investment grade rating had raised US$5.3 billion over the year – so-called high-yield issuances – while in 2013 only three companies had undertaken such issuances raising US$1.9 billion.
Putting the brakes on
Then came a dampener. On 25 November 2014, the Reserve Bank of India (RBI) issued a circular reiterating the applicability of stringent norms for external commercial borrowing.
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