India's inclusion in JPMorgan bond index to attract billions in foreign inflows, support rupee

JPMorgan will include Indian government bonds in its emerging market debt index starting in June 2024, expected to attract up to $50 billion in foreign inflows.
India's inclusion reflects confidence in its economy and was prompted by RBI introducing securities exempt from foreign investment restrictions.
Inflows expected to lower India's borrowing costs, cap bond yields, support the rupee, and ease financing of current account deficit.
Rupee initially rallied on news but gains were dampened by importers buying dollars and rising US Treasury yields.
Other index providers like FTSE Russell and Bloomberg Barclays may also add India bonds to their benchmarks, boosting inflows further.