Debt Market
What is a Fully Accessible Route (FAR) in G-Secs?
WHAT IS FAR?
The Fully Accessible Route (FAR) is a regulatory framework introduced by the Reserve Bank of India (RBI) and the Government of India in March 2020 to attract more foreign investment into Indian government securities (G-Secs).
KEY FEATURES
| Feature | Details |
|---|---|
| Purpose | To enable unrestricted access for Non-Resident Investors (FPIs) |
| Eligible Securities | Specific Government of India bonds are designated under FAR |
| Access Type | No investment ceiling or limit for foreign investors |
| Currency | Indian Rupee |
| Tenor | Usually applies to longer-term G-Secs (5, 10, 30 years, etc.) |
| Participants | Available to both foreign and domestic investors equally |
Why FAR Was Introduced?
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To integrate India’s bond market with global financial markets.
-
To minimize entry restrictions in India's debt market and to increase foreign capital inflow into government securities.
- As part of efforts to include Indian G-Secs in global bond indices (like JPMorgan, Bloomberg-Barclays, FTSE).
Example
If the government issues a 10-year bond of ₹1,000 crore under FAR, Foreign investors can invest any amount without the usual FPI investment limits. Domestic investors can also buy it normally. No sectoral caps or regulatory ceilings apply under FAR.
Impact So Far
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Helped attract foreign portfolio investment in Indian bonds.
-
Paved the way for India’s inclusion in JPMorgan Government Bond Index (starting 2024–25).
-
Added depth and liquidity to the bond market.
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