Rajiv Bajaj, Vice Chairman & MD of Bajaj Capital believes that investors are now looking at safe capital protective returns. Therefore, fixed income products and tax-free bonds saw a phenomenal response last year.
Relaxing the ECB norms, the RBI today said NBFCs operating as infrastructure finance companies (IFCs) can now avail the overseas borrowings up to 75 per cent of their owned funds without its approval.
India's plan to double the issue of tax-spared bonds in the financial year beginning April to build highways and railroads is unlikely to find many takers because of a supply overhang and poor returns.
The government is in talks with the Reserve Bank of India (RBI) and stock market regulator to allow infrastructure finance companies to issue bonds to foreign investors.
With the government offering tax benefits on infrastructure bonds from this year, three leading infrastructure finance companies are expected to collectively raise about Rs 7,600 crore through the bond issues.