HSBC Holdings has become one of the largest foreign buyers of Indian debt, purchasing at least $3 billion in government bonds since July 2026. The bank is funding these acquisitions through foreign-currency non-resident (FCNR) dollar deposits held by members of the Indian diaspora. Indian 10-year government bonds are yielding between 6.8% and 7%, offering a 3-4% premium over developed market equivalents, after India removed withholding and capital gains taxes on government bonds for foreign investors in April 2026. Foreign investors have poured a total of $7.7 billion into Indian debt since the beginning of the year through mid-July 2026, surpassing the $6.6 billion invested throughout all of 2025.
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