Masala bonds are
bond
Bond or bonds may refer to:
Common meanings
* Bond (finance), a type of debt security
* Bail bond, a commercial third-party guarantor of surety bonds in the United States
* Chemical bond, the attraction of atoms, ions or molecules to form chemica ...
s issued outside India but denominated in
Indian Rupees
The Indian rupee ( symbol: ₹; code: INR) is the official currency in the republic of India. The rupee is subdivided into 100 ''paise'' (singular: ''paisa''), though as of 2022, coins of denomination of 1 rupee are the lowest value in use w ...
, rather than the local currency. Masala is a
Hindi
Hindi ( Devanāgarī: or , ), or more precisely Modern Standard Hindi (Devanagari: ), is an Indo-Aryan language spoken chiefly in the Hindi Belt region encompassing parts of northern, central, eastern, and western India. Hindi has been ...
word meaning spices. The term was used by the
International Finance Corporation
The International Finance Corporation (IFC) is an international financial institution that offers investment, advisory, and asset-management services to encourage private-sector development in less developed countries. The IFC is a member of ...
(IFC) to evoke the culture and cuisine of India. Unlike dollar bonds, where the borrower takes the currency risk, Masala bonds makes the investors bear the risk. The first Masala bond was issued by the
World Bank
The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Inte ...
-backed IFC in November 2014 when it raised 1,000
₹10million bonds to fund infrastructure projects in India. Later in August 2015 International Financial Cooperation for the first time issued green masala bonds and raised ₹3.15 Billion to be used for private sector investments that
address
An address is a collection of information, presented in a mostly fixed format, used to give the location of a building, apartment, or other structure or a plot of land, generally using political boundaries and street names as references, along ...
climate change in India
Climate change in India is having profound effects on India, which is ranked fourth among the list of countries most affected by climate change in 2015. India emits about 3 gigatonnes ( Gt) CO2eq of greenhouse gases each year; about two and a ha ...
.
In July 2016
HDFC raised ₹30 billion from Masala bonds and thereby became the first Indian company to issue masala bonds. In the month of August 2016 public sector unit
NTPC issued first corporate green masala bonds worth ₹20 billion.
See also
*
Foreign currency denominated bond
*
Eurobond
*
Dim sum bond
*
Samurai bond A samurai bond is a yen-denominated bond issued in Tokyo by non-Japanese companies, and is subject to Japanese regulations. These bonds provide the issuer with an access to Japanese capital, which can be used for local investments or for financin ...
*
Uridashi bonds
Sources
{{reflist
Bonds in foreign currencies
Rupee
Investment in India