Daijiworld Media Network- New Delhi

New Delhi, Mar 19: Municipal bond issuances in India are expected to surpass Rs 1,500 cr in the financial year 2025-26, driven by the government's push for urban infrastructure development, according to credit rating agency ICRA.

With increasing emphasis on sustainable urban growth and smart city projects, several municipal corporations are likely to tap into the bond market to raise funds. The central and state governments have been encouraging municipal bodies to explore alternative funding sources to reduce dependency on grants.

"The government's policy initiatives and incentives for municipal bonds have strengthened investor confidence, leading to greater participation in the segment," ICRA stated in its report.

Experts believe that improved financial discipline, credit ratings, and transparency in governance will further boost municipal bond issuances, paving the way for long-term infrastructure growth in Indian cities.