Bloomberg Index Services defers including Indian bonds in global index
MUMBAI, Jan 13 (Reuters) – Bloomberg Index Services on Tuesday deferred the inclusion of Indian bonds in its flagship Global Aggregate Index, disappointing some investors who had been expecting inclusion and sending yields higher.
Overall, responses indicated broad support for the long-term trajectory of the Indian government bond market and for its potential eventual inclusion in global investment grade benchmarks, the service provider said in a note.
Still, a number of respondents highlighted important operational and market-infrastructure considerations that merit further evaluation before inclusion in a flagship global investment grade index, it said.
Bloomberg Index Services said it will provide an update in mid-2026.
India’s bond market reacted negatively to the news, since most participants had anticipated the inclusion to be announced this week.
India’s 10-year benchmark bond yield jumped as much as 6 basis points to 6.64% after the news.
The verdict comes against the backdrop of Indian bonds steadily finding their way into major emerging-market benchmarks, including the JPMorgan Emerging Market Local Currency Index in June 2024, the Bloomberg Emerging Market Local Currency Bond Index in January 2025, and the FTSE Russell Emerging Market Index in September 2025.
“The supply-demand imbalance is already large for Indian bonds, and the market had probably assumed that the index inclusion would help with that so the deferral is not an encouraging development from that perspective,” Vivek Rajpal, Asia macro strategist at investment advisory firm JB Drax Honore.
“The deferral will likely mean that near-term premium on the yields will stay, and it could also heighten bonds’ reliance on the RBI’s open market operations.”
Indian states and the central government are slated to borrow a record combined 8 trillion rupees ($88.65 billion) via debt markets in the January-March quarter.
