India’s 2035 Government Bond: Low Commission, High Market Confidence?

The Reserve Bank of India (RBI) has announced the underwriting commission for the new government bond maturing in 2035 at a nominal rate of 0.0015 rupees per 100 rupees of bond value. This fresh issuance marks a significant step in India’s capital market operations to meet fiscal needs while ensuring investor confidence.

 

Key Details On The New Government Bond

 

The bond, issued as part of the government’s borrowing programme, carries a 6.33% coupon rate and matures in 2035.

 

The RBI employed a competitive additional underwriting process, fixing the commission rate, to fully subscribe unsold portions of the bond issue.

 

Underwriting ensures smooth debt issuance, with primary dealers committing to buy any unsubscribed securities, stabilizing market demand.

 

Market Impact And Significance

 

The extremely low underwriting commission reflects a tight market demand and the government’s commitment to cost-effective borrowing.

 

This bond issuance is part of a larger debt strategy aiming to raise substantial funds for government expenditure while keeping yields attractive for investors.

 

The government leverages RBI’s core banking solution “E-Kuber” platform to streamline electronic bidding and allotment for both competitive and non-competitive bids.

 

This well-regulated auction framework strengthens bond market stability and supports India’s growing economic financing requirements.

 

Sources: Business Standard, Reuters, ANI News October 2025