Bloomberg Delays Decision on Including India in Global Bond Index Despite Major Market Reforms

Bloomberg Defers Decision on India Bond Index Inclusion

Bloomberg Index Services Limited (BISL) has postponed its decision on including Indian government bonds in the Bloomberg Global Aggregate Index, stating that additional time is required before reaching a final conclusion.

According to BISL, recent reforms in India's bond market are significant, but more time is needed to assess how effectively these changes are reflected in day-to-day market operations.

The agency said it will continue engaging with market participants through its governance process and provide another update as the review progresses.

Why Has Bloomberg Delayed the Decision?

BISL stated that the recent reforms are important steps forward, but it wants to ensure they become fully established in the market before making an inclusion decision.

The review process will continue with feedback from global investors and other market participants before a final decision is announced.

Key Reforms Introduced

The Government of India and the Reserve Bank of India (RBI) recently implemented several measures aimed at improving foreign investor access to the government bond market.

These include

Exemption from income tax on interest income and capital gains earned by Foreign Portfolio Investors (FPIs) from investments in government securities.

The tax exemption became effective from 1 April 2026.

A similar tax exemption was also extended to the Bank for International Settlements (BIS).

RBI expanded the Fully Accessible Route (FAR) by allowing unrestricted foreign investment in all new 15-year, 30-year and 40-year government securities.

These reforms addressed several operational issues previously highlighted during Bloomberg's earlier review.

Market Focus Has Shifted

According to market participants, the discussion has now shifted beyond market accessibility.

Instead, global investors are increasingly evaluating whether Indian government bonds currently offer attractive value compared to other international fixed-income markets.

This has become one of the important considerations in Bloomberg's ongoing review.

India's Existing Global Bond Index Presence

India has already secured inclusion in several major global bond indices:

• JP Morgan Global Bond Index – Emerging Markets: Since June 2024
• Bloomberg EM Local Currency Government Index: Since January 2025

FTSE Russell Emerging Market Government Bond Index: Since September 2025

However, inclusion in the Bloomberg Global Aggregate Index remains pending.

What Happens Next?

Bloomberg said it will continue discussions with market participants before making a final decision.

The next major review update for the Bloomberg Global Aggregate Index is expected in November, when investors will closely watch whether Indian government bonds receive inclusion.

Key Takeaways

Bloomberg has delayed its decision on India's inclusion in the Global Aggregate Bond Index.

Recent tax reforms and RBI measures have improved foreign investor access.

Market attention has shifted from accessibility to investment attractiveness.

India is already part of several major global bond indices.

The next review update is expected in November.

Disclaimer

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