Tabula FTSE Indian Government Bond Short Duration UCITS ETF (TIND) offers a yield of 7.1% and invests in Indian Rupee denominated government bonds issued by the Reserve Bank of India.
The fund aims to track the FTSE Indian Government Bond FAR Short Duration Capped index, which focuses on the short-duration segment of the market. It has a total expense ratio of 0.39%.
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In September last year, JP Morgan said it would add Indian government bonds to its widely-tracked emerging markets debt index from 28 June 2024, paving the way for billions of inflows to the world’s fifth-largest economy.
Tabula said this change will result in positive capital inflows for the country’s currency, bond prices and wider economy, with Stefan Garcia, chief commercial officer noting inflows of over $35bn are expected over the next 18 months.
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Michael John Lytle, Tabula CEO, added: “[India] has an investment grade credit rating and a liquid and transparent bond market. However, until recently, the government bond market has been difficult to access, with foreign investment limited.
“These restrictions were relaxed in 2020 with the introduction of Fully Accessible Route (FAR) bonds, open to foreign investors. FAR bonds already account for over 20% of this $1.1trn market and include all new issues of five, ten and 30-year bonds.”
He said: “TIND provides European investors with liquid and transparent access to the most attractive short-duration segment of the market.”
