Government may raise Rs 10000-Crore via Bharat Bond ETF by December

The government is expected to launch the next tranche of the Bharat Bond exchange-traded fund (ETF) by December and hopes to raise over Rs 10,000 crore to fund growth plans of central public sector enterprises, according to a senior finance ministry official.

The official added that the fund requirements of Central Public Sector Enterprises (CPSE) are being worked out and the third tranche of the exchange-traded fund (ETF) will be launched by the end of the calendar year. "We are finalizing on the amount to be raised but it would be over Rs 10,000 crore," the official said. Bharat Bond ETF is an exchange-traded fund that invests in debt of public sector companies. The exchange-traded fund currently invests only in 'AAA'-rated bonds of public sector companies.

The funds raised through the debt ETF helps in smoothening borrowing plans of the participating CPSEs or public sector banks. It also helps them in meeting their capital expenditure needs. The 2nd  tranche of the Bharat Bond ETF, which was launched in July 2020, was oversubscribed over 3 times, collecting about Rs 11,000 crore. It had brought about Rs 12,400 crore in its debut offer in December 2019. The Bharat Bond ETF offered maturity options of five and 12 years in its II-tranche, while in the I-tranche, maturity options were for 3 and 10 years.


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