BRICS Bank to Issue First Indian Rupee Bond — Plans to Boost Local Currency Lending

The New Development Bank (NDB), also known as the BRICS Bank, is reportedly planning to issue its first Indian rupee bond by October. Last week, the bank issued its first South African rand bond. “NDB is seeking to increase its presence in the local capital markets of its member countries, to fund its robust portfolio of local currency loans,” said the BRICS Bank’s chief financial officer.

BRICS Bank to Issue INR Bond

The New Development Bank (NDB), commonly referred to as the BRICS Bank, is planning to issue its first Indian rupee bond by October, Reuters reported, citing Vladimir Kazbekov, vice president and chief operating officer of the BRICS Bank.

The NDB is a multilateral development bank established by the BRICS nations (Brazil, Russia, India, China, and South Africa) with the purpose of mobilizing resources for infrastructure and sustainable development projects in emerging markets and developing countries. In 2021, the BRICS Bank initiated membership expansion and admitted Bangladesh, Egypt, United Arab Emirates, and Uruguay as its new member countries.

Kazbekov stated during a press briefing on Monday:

We’re going to tap Indian market — rupees — maybe by October in India.

“Now we start thinking seriously … to use one member country’s currency to finance projects with that currency in another member. Let’s say, a project in South Africa to be financed in CNY (Chinese yuan), not with USD (U.S. dollar),” he added.

The Shanghai-based lender aims to increase local currency lending, most of which has so far been in the Chinese yuan, from about 22% to 30% by 2026. Dilma Rousseff, the former Brazilian leader who heads the New Development Bank, recently told the Financial Times that the bank expects to lend between $8 billion to $10 billion this year. “Our aim is to reach about 30% of everything we lend . . . in local currency,” she emphasized.

On Aug. 15, the New Development Bank announced the successful issuance of its first ZAR bond in the South African bond market. Leslie Maasdorp, the BRICS Bank’s chief financial officer, explained at the time that “the proceeds will be used to fund infrastructure and sustainable development projects in South Africa.” He noted:

NDB is seeking to increase its presence in the local capital markets of its member countries, to fund its robust portfolio of local currency loans.

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