Malaysia’s UOB Asset launches India bond fund before index inclusion

UOB Asset Management Malaysia launched an India-focused bond fund last week, giving Malaysian investors an opportunity to snap up rupee-denominated debt ahead of the South Asian country’s inclusion to JPMorgan Chase & Co’s emerging market index. 

The United Bharat Fixed Income Fund feeds into a target fund, the HSBC GIF India Fixed Income fund, according to the fact sheet shared with Bloomberg. It has a passive strategy, and investment decisions will be made by the HSBC fund, the documents showed. It will be UOB Asset Management Malaysia’s first India-focused bond fund, CEO Lim Suet Ling said.

Foreign investors have funnelled nearly US$10 billion into India’s index-eligible bonds in the run-up to the inclusion. Investors such as Abrdn and Vontobel have been investing in the local currency bonds as low correlation with global markets, one of the world’s fastest growth rates and a stable currency make Indian assets an attractive bet.  BLOOMBERG