About

• Masala Bonds represent rupee-denominated bonds that Indian entities issue outside of India. 
• Masala bonds are a financial instrument that allows Indian companies or organisations to raise capital from foreign investors in Indian currency (INR) rather than the local currency of the investor. 
• The primary objectives of Masala Bonds are to fund infrastructure projects, promote internal growth through borrowings, and internationalise the Indian rupee. 
• Understanding the masala bonds’ meaning involves recognizing them as rupee-denominated bonds that allow Indian companies to secure funds in foreign currencies, thereby minimising currency risk for both issuers and investors on a global scale.
• Since Masala Bonds are issued in Indian currency, the currency risk lies with the investor and not the borrower. This means if the Indian rupee depreciates, the foreign investor bears the loss. 
• Masala Bonds are an attractive option for foreign investors looking to invest in Indian assets and for Indian entities seeking to diversify their funding sources and tap into the global capital market.