NSE receives no-objection certificate to introduce corporate bond index futures contracts
GS3Economy · S&T · Environment · Security· Capital markets & SEBI· Prelims·
Capital market infrastructure: a GS3 topic on risk management and debt market liquidity.
Why in news
The National Stock Exchange (NSE) received a no-objection certificate to introduce corporate bond index futures contracts to enhance risk management, pending RBI approval.
Background
The NSE received a no-objection certificate for corporate bond index futures contracts. As of August 2026, SEBI reported total outstanding corporate bonds reached 61.05 trillion rupees ($636.07 billion).
Facts for Prelims
- BodyNSE: National Stock Exchange of India
- BodySEBI: Securities and Exchange Board of India
- FactTotal outstanding corporate bonds reached 61.05 trillion rupees as of August 2026
- BodyRBI: Reserve Bank of India (final approving authority for the contracts)
Prelims practice question
Which body serves as the final approving authority for the introduction of corporate bond index futures contracts?
- (a)Reserve Bank of India
- (b)NITI Aayog
- (c)Ministry of Finance
- (d)IRDAI
Show answer
Answer: (a) Reserve Bank of India — The note specifies that the introduction of these contracts is pending RBI approval.
For Mains
Q. Discuss how the introduction of corporate bond index futures can enhance risk management and liquidity in the Indian debt market.
Dimensions to cover in your answer
- Market depth: Providing hedging mechanisms for institutional investors against interest rate volatility
- Regulatory oversight: Balancing NSE's operational autonomy with RBI's systemic risk monitoring
- Liquidity provision: Reducing the 'buy-and-hold' nature of corporate bonds to facilitate active trading
Keywords: Risk Management · Capital Markets · Debt Instruments · Liquidity · Hedging
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