Niti Aayog's Strategy to Enhance Corporate Bond Markets

Niti Aayog's 2023-24 Annual Report outlines strategies to deepen corporate bond markets as an alternative to bank finance. This move aims to provide cost-effective, long-term funding options for companies. A Task Force and Expert Group are also established to improve the Indian Statistical Systems for better governance.

Niti Aayog is actively working on strategies to enhance the corporate bond markets, aiming to offer an alternative to bank finance for borrowers, according to its Annual Report 2023-24. The corporate bond market helps companies raise long-term funds at competitive costs.

''The vertical is in the process of developing a holistic research buttressed with key policy recommendations to deepen the corporate bond markets to achieve an alternative to bank finance for borrowers,'' it said.

The report highlights that corporate bond markets are an efficient cost-minimisation process for long-term funding and significantly contribute to financial stability. ''It is a mechanism for supporting banks in long-term lending against relatively shorter-tenor liabilities and helping insurance companies and pension fund managers to diversify their portfolios while managing risks and liquidity gaps,'' it added.

Additionally, Niti Aayog has formed a Task Force on the Indian Statistical Systems to address issues and create a cohesive strategy for leveraging data in governance. An Expert Group has also been constituted to assess specific areas and propose solutions to improve survey quality and harmonise data, particularly in the fields of Nutrition, Labour, and Business Statistics.

(With inputs from agencies.)