New Development Bank NDB Will Issue First Rupee Bond by 2026

1. Core Announcement

• The New Development Bank (NDB), which is set up by the BRICS countries (Brazil, Russia, India, China, South Africa) intends to issue its first Indian rupee-denominated bond.
• Timeline: It will be released at the domestic market in the first half of March 2026.
• Status Quo: The bank is currently in their final stages of negotiating the issuance with the reserve bank of India (RBI).

2. Bond Issuance Details

• Target Amount: In the first tranche, they are looking to raise $400-500 million (equivalent).
• Tenure: The bonds will have a duration of 3 to 5 years.

3. Strategic Precedents and Strategy.

• This is an action that falls under the larger plan of the NDB to diversify its sources of funding and encourage local currencies in its member countries.
• Past Precedents: The NDB has already raised funds in Chinese Yuan and South African Rand.
• Market Precedent: other multilateral agencies such as the World Banks International Finance Corporation (IFC) have already successfully issued rupee bonds and this indicates that there is a lot of investor appetite.

4. Broader Strategic Goal

• The NDB has an objective of financing 30 percent of its allocations in the local currencies of member countries in its 2022-26 strategy.
• This move helps in stabilizing the financial stability, decreasing the dependency on the traditional reserve currencies, which is a great milestone towards enhancing the internationalization of the Indian rupee.