China, India and Indonesia are in need of alternative sources of finance. In the coming years, these three countries will require vast amounts of capital in order to bring investments in infrastructure to the level that optimises economic growth. This study looks at the possibility to further develop the local currency bond markets in general, and to broaden and deepen the institutional investor base in China, India and Indonesia in particular.

This report was prepared in the framework of the Emerging Market Sustainability Dialogues (EMSD), which is implemented by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, the German international cooperation agency, on behalf of the German Ministry of Economic Cooperation and Development (BMZ). EMSD is a network of representatives from the financial sector, think tanks and multinational corporations who jointly develop and implement solutions for sustainable economic development in emerging economies, through consultation, dialogue and research.

Cosmina Amariei and Willem Pieter de Groen are researchers in the Financial Markets and Institutions unit at CEPS, as also was Diego Valiante at the time of writing this paper. They worked in cooperation with Yu Li from the Research Bureau of the People’s Bank of China (PBoC), Abhijnan Rej from the Observer Research Foundation (ORF) and Astrid Dita and Fauziah Zen from the Economic Research Institute for ASEAN and East Asia (ERIA).