The government has obtained approval from the Securities and Exchange Board of India for the Bharat Bond exchange-traded fund and the ETF will be open for subscription from December 12 to December 20, a government official told CNBC-TV18.
The Bharat Bond ETF will have a base size of Rs 7,000 crore base size, with a likely green shoe option of Rs 8,000 crore, said the official.
The Union Cabinet cleared the creation and launch of the Bharat Bond ETF on December 4, allowing retail investors to participate. In Budget 2019, the government had announced plans for debt ETFs of public sector bonds after the success of equity ETFs like CPSE ETF and Bharat-22.
The Bharat Bond will have a fixed maturity period and the units will be listed on stock exchanges. The ETF will include AAA-rated firms to begin with and the unit value will be priced at Rs 1,000.