The Finance Minister today held a meeting with several officials in the Department of Economic Affairs (DEA) and will announce measures for arresting the rupee fall. CNBC-TV18's Aakansha Sethi, quoting sources reports that NRI, infrastructure bonds and sovereign wealth funds are the options being contemplated to help prevent further rupee depreciation.
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Some of the points that are being concerned are NRI bonds and infrastructure bonds that will include incentives not covered by long-term infrastructure bonds or corporate bonds. The government is thinking of ways to incentivise sovereign wealth funds (SWF), especially those in the Middle East which have large amounts of money to come and invest in Indian debt and equity markets. In Indian debt market, one of the ways to incentivise them that is being considered is to allow them to rollover funds once maturity is reached.
Typically, now the SWF will once again have to bid for bonds. If rollover funds are allowed, then transaction cost for them will reduce and it will facilitate them to once again invest their money because these funds are for the long haul.
Apart from that, the government has been thinking of raising FDI caps in sectors such as defense and telecom. However, that is a slightly longer-term measure because it will involve building consensus amongst various stakeholders and it is a very sensitive issue.