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Foreign bond investors could help India with deficits

July 20, 2010  

From Aaron Pan

The country’s current account deficit looks set to rise to uncomfortable record levels this year. It needs to open up its domestic bond market to foreign investment in order to finance it, and help pay for its increasing fiscal deficit too.

India should reconsider its draconian rules preventing foreign bond investment if it is to reduce its rising current account and budget deficits, according to HSBC. Such increased funding flows would also help the country deal with a mounting fiscal deficit.


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 SYNDICATED LOANS

Rank Bookrunner Value ($m) No. %Share
1 Industrial & Commercial Bank of China - ICBC 1,160 1 16.4
1 Bank of Communications Co Ltd 1,160 1 16.4
3 State Bank of India 964 3 13.6
4 Land Bank of Taiwan 400 7 5.6
5 Maybank Investment Bank Bhd 332 1 4.7
6 AXIS Bank 236 2 3.3
7 IDBI Bank Ltd 124 1 1.8
8 HSBC 92 2 1.3
9 BNP Paribas 92 1 1.3
10 First Commercial Bank Co Ltd 65 4 0.9
Subtotal 4,623 18 65.2
Total 7,090 32 100.0


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