New Delhi - The finance ministry has invited bids from mutual funds or asset management companies (AMCs) for creating, managing and launching a debt exchange-traded fund (ETF).
In line with the 2018-19 Budget announcement, the Department of Investment and Public Asset Management (DIPAM) came out with a request for proposal to engage an AMC for creation and launch of the Debt ETF. Bids have to be submitted by December 17.
In the RFP, DIPAM said central public sector enterprise (CPSE) issuers are one of the most frequent and regularly traded segments of the corporate bond market.
The government is exploring the possibility of creating a debt ETF/fixed income product or a 'Debt ETF', comprising bonds, credit-linked note, debentures, promissory notes as underlying instruments issued by participating CPSEs/PSBs/PSUs.
The proposed Debt ETF may also include government securities (G-Secs), which would be decided at a later date, it added.
The Debt ETF would help these state-run companies and banks help meet the capex and business needs by leveraging their aggregate strength.