Sebi, RBI in conversations with boost trade in derivatives of corporate bonds in the bond -bonds

Securities and Exchange Board of India and the Reserve Bank of India are in discussions about derivatives of the corporate bonds to strengthen commercial activity in business debt, said Sebi member Ananth Narayan G Friday.

Narayan said in the Assocham National Council for Corporate Bonds: “Trade in the derivatives of the corporate bonds is a different limit in this respect. There are good discussions between Sebi and RBI, and we hope we will see progress rapidly.”

He pointed out that secondary bond volumes are approximately RS 1.4 Lakh crore per month, while stock markets on one day that act a lot. If bond treatment can be made more comparable to stock trading in terms of settlement, platforms and even trade culture- the investment class could see considerable growth, he added.
In 2023, Sebi allowed trade fairs to launch derivatives on indices of business debt with rated AA+ and higher, but the move could not get a grip.

In the field of municipal bonds, Narayan noted that from 2017 there have only been 16 issues that RS 3,134 Crore have collected, only 0.02 percent of GDP.

“The potential here is huge, but that also applies to the trust of capacity building and investors,” he said. Excellent corporate bonds have risen from RS 17.5 Lakh Crore at the end of FY15 to RS 53.6 Lakh Crore from March 2025, a CAGR of more than 12 percent. In FY25 alone, almost RS 10 Lakh Crore of corporate bonds were published, and in FY26, releases have already reached RS 3.5 Lakh -Crore by July.

Despite this growth, the market remains dominated by institutional investors such as banks, insurers, provident of funds and investment funds, while retail and foreign investors remain on the edge, Narayan added.