Bloomberg defers decision on including Indian government bonds in index

India did the homework. Removed the tax on overseas bond investors. Rolled out the welcome mat for foreign portfolio money. And Bloomberg Index Services still said “not yet.” BISL announced on July 31 that it would once again defer the decision on whether to include Indian government bonds, known as G-Secs, in the Bloomberg Global Aggregate Bond Index. This is the second deferral in roughly six months, following a similar postponement on January 13. The index serves as a benchmark for trillions in assets under management across ETFs and index funds, making inclusion a very big deal for any sovereign debt market hoping to attract global capital. What’s holding things up India’s government made a notable move in June by eliminating a tax on overseas bond investors, a reform specifically designed to smooth the path toward index inclusion. But BISL pointed to a different set of concerns. Investors tracking the index want more confidence in what the firm called “consistent operational enhancements.” In English: settlement processes are still too slow, tax administration remains clunky, and trading automation isn’t where it needs to be. BISL emphasized that its approach is rules-based, n...