Bond rout may not be enough for India to let more foreigners in

As India’s sovereign bonds suffer their worst selloff in almost two decades, the one group who actually wants to buy them looks likely to remain shut out of most of the market.

The Reserve Bank of India is expected to review the cap on foreign investment in rupee notes, currently set at around 5 percent, in March or April. It will be the first reassessment since 2015, and comes as 10-year yields have risen to a two-year high, the budget deficit widens and India’s state-run banks have been dumping the debt.

For all of the reasons to roll out the welcome mat,