Building the bonds of Viksit Bharat

India's total credit outstanding—government borrowings, corporate and municipal bond market, securitisation, money market and gross bank credit—stood at 163 per cent of gross domestic product (GDP) in 2023-24 (FY24).

- SUBODH RAI

In comparison, it was 266 per cent of GDP for the US at the end of calendar year 2023. Our government borrowing and bank credit, at 87 per cent and 56 per cent of GDP respectively, are relatively well-developed. However, the bond market accounts for only 19 per cent of GDP, and significantly trails that of the US, which stands at 119 per cent of GDP.

Interestingly, our credit-to-GDP ratio currently stands at a level similar to that of the US in 1986. The US bond market's remarkable growth, from 70 per cent of GDP in 1986 to 119 per cent of GDP now, exemplifies the benefits of developing all the segments of the bond market.

Corporate bond market: