Foreign banks chase rupee deals as offshore debt sales slow

Foreign lenders in India facing tepid demand for offshore debt are setting their sights on a new target: the country’s growing rupee bond market.

High US benchmark yields, geopolitical tensions and tariff-related swings have eroded the appeal of foreign-currency debt for Indian corporates this year, causing the issuance to drop even as Indian companies boost spending and borrowing at home.

That dynamic has boxed out foreign banks that tend to underwrite dollar bonds but historically had little heft in the domestic market, which is dominated by local players. To compete, lenders including Standard Chartered Plc and Barclays Plc, the top foreign underwriter of rupee bonds, are looking to widen their onshore offerings to appeal to Indian corporates shifting their borrowing to rupees.

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