context of basel iii requirements, would also be able to raise resources easily. development of government and corporate debt market may be approached within a framework of seven key components, viz., issuers, investors, intermediaries, infrastructure, innovation, incentives and instruments – what i have called a 7i framework. sovereign securities dominate the fixed income markets almost everywhere. in india too, the central and state governments remain the main issuers. the large supply of securities, due to enhanced borrowings, has enabled creation of benchmark securities with sufficient outstanding stock and issuances across the yield curve. the issuances across the risk - free yield curve in turn, have provided benchmarks for valuation of other bonds / financial assets and benefitted the corporate bond market. fiscal consolidation efforts of the government of india and the state governments enhance the quality of the issuers. in the field of corporate bonds besides financial sector entities, large well rated non - finance companies have also been issuers. the traditional investor base for g - sec in india comprised banks, provident funds and insurance companies with a dominance of domestic investors and limited foreign participation. in the corporate debt market, investor base is mostly confined to banks, insurance companies, provident funds, pds and pension funds. an approach of gradual opening of the domestic bond market to the foreign investors has been adopted in india keeping in view the macro - economic risks involved in providing unfettered access to them. intermediaries play an important role in development of the market by facilitating the transactions, providing value - added services and increasing efficacy of the processes. in india, the major intermediaries are the pds, industry associations like fixed income money market & derivatives association / primary dealers association of india, gilt mutual funds and the infrastructure development funds ( idfs ). infrastructure plays an important role in development of markets and want of an efficient, transparent and robust infrastructure can keep market participants away on one extreme or cause market crisis on the other. india can boast of being one of the few emerging countries with such a state of the art financial market infrastructure for the g - sec market. a state - of - the - art primary issuance process with electronic bidding and fast processing capabilities, dematerialized depository system, dvp mode of settlement, electronic trading platforms ( negotiated dealing systems and negotiated dealing systems - order matching ) and a separate central counter party in the clearing corporation of india ltd. ( ccil ) for guaranteed settlement are

, etc. taking into account government ’ s needs, market conditions, and preferences of various segments while ensuring that the entire strategy is consistent with the overall macro - economic policy objectives. reserve bank also undertakes the conduct of auctions and manages the registry and depository functions. 7. decisions on the implementation of the borrowing program, based on proposals made by the reserve bank, are periodically taken by the monitoring group on cash and debt management. this is a standing committee of officials from the mof and the reserve bank. while this represents a formal working relationship between the mof and the reserve bank, it is further complemented by regular discussions between the ministry and the reserve bank. 8. with regard to accountability and reporting, the operations of the debt management functions in reserve bank are subject to the statutory audit, internal audit and concurrent audit. recently, the comptroller and auditor general ( cag ) have started a performance audit of debt management operations in the mof and the reserve bank focusing on three “ e ” s of process excellence viz. economy, efficiency and effectiveness. while the internal debt management activities are reported in the annual report of the reserve bank, which is a statutory report and is placed before the parliament ( through mof ), the external debt management functions are reported in the annual status report on external debt presented to the parliament by the finance minister. further, the mof is publishing an annual report on government debt, the middle office in the budget division is publishing quarterly reports on the debt issued. therefore, a robust reporting of debt is in place in our country. 9. as can be seen, we have sound institutional mechanism with roles and responsibilities clearly entrusted to the reserve bank and the government. this has helped in discharging our mandate effectively. debt management strategy policy objectives 10. the main objective of debt management is to ensure that the government ’ s financing needs and its payment obligations are met at low cost over the medium to long run consistent with a prudent degree of risk. prudent degree of risk ensures that no problems exist in rollover of debt. further, the debt structure must be sustainable to ensure financial stability across time periods. another important objective is to promote deep and liquid bis central bankers ’ speeches financial markets to minimize long term borrowing cost markets. the debt management policy must also be consistent with other macro - economic policies including monetary policy. 11. debt management strategy ( dms ) comprising objectives, various benchmarks & portfolio indicators and yearly issuance