New Delhi – U.S. Embassy and U.S. Treasury officials joined counterparts today from India’s Ministry of Housing and Urban Development, the city of Vadodara, and the Securities and Exchange Board to celebrate the successful issuance of Vadodara’s first-ever municipal bond. The bond will provide funds for infrastructure in Vadodara. A written case study will also be published sharing lessons learned from Vadodara’s bond issuance that will benefit other Indian cities issuing their own municipal bonds in the future.
In remarks delivered to open the event, Chargé d’Affaires Patricia Lacina commented: “Municipal finance can help to pay for the vital capital projects – roads, energy, water, sanitation, and other essentials – that make a meaningful difference in the quality of life for many people. Municipal finance also represents a form of empowerment. As cities start to finance their own projects, municipal officials are called upon to be good financial stewards, who make the best possible use of funding to achieve the best possible results for those they represent. I am excited about the example this project sets and the possibilities it provides for the people of Vadodara. We welcome other Indian cities following suit and issuing their own municipal bonds in the future. ”
Vadodara’s bond, which took place in March of this year, was oversubscribed by 10 times (₹1007 crore in bids received from 33 bidders) and was priced at a low yield of just 7.15%.
Vadodara is the second Indian city to issue a municipal bond with assistance from the U.S. Treasury Department’s Office of Technical Assistance, following Pune’s bond issuance in 2017.