The Reserve Bank of India (RBI) has announced an auction of ₹320 billion ($3.6 billion) 10-year government securities on October 3, 2025, aiming to establish a fresh benchmark for medium-term debt in the Indian bond market. The new issuance is expected to serve as the primary reference for borrowing costs in the coming weeks.
Government Borrowing Plan
The upcoming auction forms part of the Centre’s broader H2 borrowing programme, which targets ₹6.77 trillion through debt issuance. In line with this plan, the government is increasing the share of 10-year securities while reducing reliance on ultra-long bonds maturing in 30–50 years. This shift signals a strategic move towards medium-term borrowing, aligning investor demand with funding requirements.
Market Context and Impact
Currently, the 6.33% 2035 bond is the market benchmark, with an outstanding amount of ₹1.8 trillion. The new 10-year paper is expected to replace it as the key reference point for pricing government debt. Following the announcement, bond yields reacted promptly, with the existing benchmark yield rising to 6.5547% as traders adjusted to the heavier allocation of medium-term instruments.
The new bond is anticipated to attract significant investor interest, given its role in guiding yields across the sovereign curve and providing a fresh tool for portfolio calibration.
Summary
India will auction $3.6 billion in 10-year government bonds on October 3, 2025, marking the introduction of a new benchmark for medium-term debt. The move is part of the government’s ₹6.77 trillion H2 borrowing plan, emphasizing 10-year securities over ultra-long bonds. Markets have already reacted, with yields adjusting to the anticipated supply. The auction is expected to recalibrate borrowing costs and provide investors with a fresh reference for pricing across India’s sovereign debt curve.
Disclaimer:
This article is intended solely for educational and informational purposes. The securities or companies mentioned are provided as examples and should not be considered as recommendations. Nothing contained herein constitutes personal financial advice or investment recommendations. Readers are advised to conduct their own research and consult a qualified financial advisor before making any investment decisions.
Investments in securities markets are subject to market risks. Please read all related documents carefully before investing.