IRDAI permits insurers to invest in New Development Bank’s onshore rupee bonds
The IRDAI has authorized insurance companies to invest in onshore rupee bonds issued by the New Development Bank. This move aims to diversify investment options for insurers while supporting infrastructure and sustainable development projects in India.
Why it matters
This policy change provides a new investment vehicle for insurers and aligns with the BRICS nations' goal of mobilizing capital for emerging market infrastructure.
Insurance regulator IRDAI has permitted insurers to invest in Maharajah INR Bonds (Onshore Rupee Bonds) of the New Development Bank, an approval that assumes significance ahead of next month’s BRICS Summit in Delhi.
It follows representation from the New Development Bank, seeking approval, for the NDB Maharajah INR bonds under which it proposes to raise ₹25,000 crore over a five-year period, the Insurance Regulatory and Development Authority of India (IRDAI) said communicating its approval to the insurers in a circular.
The multilateral development bank, established by Brazil, Russia, India, China and South Africa (BRICS), intends to use the bond proceeds towards general corporate purposes for financing/onward lending to sustainable development, sustainable infrastructure, green, social projects in India.
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