Japanese develop yen for Indian debt paper

The Japanese haven't just developed a yen for Indian equities "" they have a matching hunger for Indian debt paper as well.

This has been demonstrated by the response to Export-Import Bank of India's (Exim Bank) first Samurai bond offering.

The five-year, yen 23 billion (about $168 million) bond issue on Friday was successfully launched in Tokyo. The Exim Bank issue was the first Samurai bond offering from India in 15 years.

The last Samurai bond was by Industrial Development Bank of India in 1991. This is also the first instance of such a bond being floated by one of the BRIC nations in this century.

Samurai bonds are debt instruments issued in the domestic Japanese market by foreign issuers. The Samurai market has a size of over $10 trillion yen.

Exim Bank has been increasingly tapping the Japanese market through yen-denominated offerings in global markets.

The bank has decided to go for a direct offering in the Japanese market to take advantage of the lower withholding tax which is charged on the interest paid.