{"id":13337,"date":"2026-05-06T13:59:08","date_gmt":"2026-05-06T13:59:08","guid":{"rendered":"https:\/\/goldenpi.com\/blog\/?p=13337"},"modified":"2026-05-06T13:59:08","modified_gmt":"2026-05-06T13:59:08","slug":"state-development-loans-sdl","status":"publish","type":"post","link":"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/","title":{"rendered":"State Development Loans (SDLs): The Overlooked Government Bonds with Higher Yields"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Let\u2019s say you have some idle funds you wish to meaningfully invest in a fixed-income instrument without taking on too much risk. Naturally, you turn your attention towards government securities (G-Secs). However, you find that the yields are very low.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">But what if there were a government-backed fixed-income instrument that offered higher yields? <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\"> are exactly that. In this article, we\u2019ll explore these bonds in detail, including their advantages and why you should consider investing in them.\u00a0<\/span><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_79_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#What_are_State_Development_Loans_SDLs\" >What are State Development Loans (SDLs)?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#SDLs_vs_G-Secs_How_Do_They_Differ\" >SDLs vs. G-Secs: How Do They Differ?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#How_do_State_Development_Loans_SDLs_Work\" >How do State Development Loans (SDLs) Work?\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#Key_Features_of_State_Development_Loans\" >Key Features of State Development Loans\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#Advantages_of_State_Development_Loans\" >Advantages of State Development Loans\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#Why_Should_You_Consider_SDL_Bonds\" >Why Should You Consider SDL Bonds?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#How_To_Invest_in_State_Development_Loans_in_India\" >How To Invest in State Development Loans in India?\u00a0\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#Diversify_Your_Fixed-Income_Portfolio_With_SDL_Bonds\" >Diversify Your Fixed-Income Portfolio With SDL Bonds<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#FAQs_on_State_Development_Loans_in_India\" >FAQs on State Development Loans in India\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\/#Disclaimer\" >Disclaimer:<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"What_are_State_Development_Loans_SDLs\"><\/span><b>What are State Development Loans (SDLs)?\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">State Development Loans (SDLs) are a type of government security (G-Sec). These bonds are issued by individual state governments through the Reserve Bank of India (RBI).\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The primary objective of <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> is to help state governments borrow money from the public, which is then used to finance their expenditure and to meet fiscal deficits.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In exchange for investing in <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\">, you receive interest payments at fixed intervals until the bond maturity date. Once the bond matures, your principal investment is returned.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"SDLs_vs_G-Secs_How_Do_They_Differ\"><\/span><b>SDLs vs. G-Secs<\/b><b>: How Do They Differ?\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Many investors think that SDLs and G-Secs are two different fixed-income investment options. However, that\u2019s not true.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">G-Secs are a broad category of government-backed fixed-income instruments. It includes both bonds issued by the central government and the various state governments of India.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">State Developmental Loans are just a sub-category of G-Secs and only include bonds issued by the state governments of India.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_do_State_Development_Loans_SDLs_Work\"><\/span><b>How do State Development Loans (SDLs) Work?\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">In January 2023, the state government of Maharashtra issued an SDL through the RBI &#8211; 7.70% Maharashtra SGS 2033.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The particulars of the SDL bond are as follows:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Interest Payment Frequency:<\/b><span style=\"font-weight: 400;\"> Semi-annual\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Interest Rate (Coupon Rate):<\/b><span style=\"font-weight: 400;\"> 7.70% per annum<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Tenure:<\/b><span style=\"font-weight: 400;\"> 10 years<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Maturity Date:<\/b><span style=\"font-weight: 400;\"> January 25, 2033\u00a0 \u00a0 \u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Let\u2019s assume you invest \u20b91 lakh in this SDL. You will receive interest of \u20b93,850 semi-annually on the stipulated interest payment dates. These interest payments will continue until the bond matures on January 25, 2033. Finally, on the maturity date, you will get your principal investment of \u20b91 lakh back.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Key_Features_of_State_Development_Loans\"><\/span><b>Key Features of State Development Loans\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><img decoding=\"async\" class=\"alignnone wp-image-13333\" src=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-300x142.png\" alt=\"\" width=\"1016\" height=\"481\" srcset=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-300x142.png 300w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-1024x486.png 1024w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-768x364.png 768w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-1536x729.png 1536w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/05\/06131022\/State-Development-Loans-key-features-1-2048x972.png 2048w\" sizes=\"(max-width: 1016px) 100vw, 1016px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">State government bonds in India<\/span><span style=\"font-weight: 400;\"> have certain key features that set them apart from other fixed-income instruments. Here\u2019s a quick overview of some of its characteristics.\u00a0<\/span><b><\/b><\/p>\n<h3><b>Issued by State Governments\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> are issued by the various state governments of India to fund their financial requirements and developmental expenditure. In exchange for the funding, the governments pay interest on the invested amount at different frequencies until the maturity date.\u00a0<\/span><\/p>\n<h3><b>RBI-Regulated Auctions<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">The Reserve Bank of India regulates <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\">. It also conducts SDL auctions on behalf of state governments from time to time. Since these bonds can only be purchased through RBI-regulated auctions, there\u2019s a high level of transparency and trust.<\/span><b><\/b><\/p>\n<h3><b>Fixed Coupon Rate<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">State Development Loans offer fixed interest rates, also known as <a href=\"https:\/\/goldenpi.com\/blog\/fixed-income\/govt-securities\/what-is-a-coupon-rate\/\">coupon rates<\/a>. This means that the <\/span><span style=\"font-weight: 400;\">SDL yield<\/span><span style=\"font-weight: 400;\"> will remain the same throughout the tenure, irrespective of how the rates in the market change.\u00a0<\/span><b><\/b><\/p>\n<h3><b>Long-Term Tenure<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">The tenures of <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\"> are often very long. They can range anywhere from 10 to 30 years. This makes it ideal for investors looking to meet long-term financial goals.\u00a0\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Low Risk of Default<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> are backed by the state governments issuing them. As a result, they carry a low risk of default. As a matter of fact, these bonds are ranked just below G-Secs issued by the central government of India in terms of safety.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Advantages_of_State_Development_Loans\"><\/span><b>Advantages of State Development Loans\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Let\u2019s now look at some key advantages offered by <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\">.\u00a0\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Higher Yields<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">Compared to G-Secs issued by the central government of India, <\/span><span style=\"font-weight: 400;\">SDL yield<\/span><span style=\"font-weight: 400;\">s are often higher by 25 to 75 basis points per annum (0.25% to 0.75% per annum).\u00a0\u00a0\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Predictable Income\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">One of the biggest advantages of <\/span><span style=\"font-weight: 400;\">SDL for retail investor<\/span><span style=\"font-weight: 400;\">s is the predictability of income. The fixed coupon rates ensure that you know exactly how much interest you will earn throughout the bond\u2019s tenure. Moreover, since SDLs are backed by state governments, the risk of interest payment default is also very low.\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Liquidity<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> can be freely traded on stock exchanges. If you\u2019re in need of funds for an emergency, you can simply liquidate your SDL investments on the secondary market before the actual maturity date.\u00a0<\/span><b><\/b><\/p>\n<h3><b>Portfolio Diversification\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">If your fixed-income portfolio consists of G-Secs and <\/span><a href=\"https:\/\/goldenpi.com\/corporate-bonds\"><span style=\"font-weight: 400;\">corporate bonds<\/span><\/a><span style=\"font-weight: 400;\">, including State Development Loans from different state governments could reduce concentration risk through diversification.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Why_Should_You_Consider_SDL_Bonds\"><\/span><b>Why Should You Consider SDL Bonds?<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">With <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\">, you don\u2019t have to choose between safety and high returns. When you invest in them, you get the benefit of low default risk and a yield that\u2019s higher than what G-Secs issued by the central government offer.\u00a0 <\/span><span style=\"font-weight: 400;\">And since <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\"> are backed by state governments, there\u2019s a high level of predictability involved. The interest payments are fixed and made on time at the mentioned interest payment dates until the maturity date. So, if you\u2019re looking for a steady secondary income stream, <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> could be the right choice for you.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_To_Invest_in_State_Development_Loans_in_India\"><\/span><b>How To Invest in State Development Loans in India?\u00a0\u00a0<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">If you wish to include SDLs in your fixed-income portfolio, you can invest in them through any of the following avenues.\u00a0<\/span><b><\/b><\/p>\n<h3><b>Through RBI Retail Direct<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">RBI Retail Direct is a free platform designed and managed by the <a href=\"https:\/\/rbiretaildirect.org.in\">Reserve Bank of India<\/a>. The primary objective is to make G-Secs more accessible to retail investors. Through the platform, you can open a Gilt account directly with the RBI and bid for an <\/span><span style=\"font-weight: 400;\">SDL as a retail investor<\/span><span style=\"font-weight: 400;\">.\u00a0\u00a0\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Through Stock Exchanges<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">If you\u2019ve missed the initial issue of an SDL, you can still purchase it through stock exchanges like the NSE and the BSE. <\/span><span style=\"font-weight: 400;\">State government bonds in India<\/span><span style=\"font-weight: 400;\"> are listed and freely traded on the exchanges.\u00a0 <\/span><span style=\"font-weight: 400;\">When you purchase an SDL through the secondary market, it is electronically held in your demat account. And you receive the interest payments until the bond maturity date.\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Online Bond Platforms<\/b><span style=\"font-weight: 400;\">\u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Alternatively, you can also invest in <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> through <a href=\"https:\/\/goldenpi.com\/\">SEBI-registered online bond platforms<\/a>. These platforms are designed to help make investing in G-Secs seamless and easy.\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Diversify_Your_Fixed-Income_Portfolio_With_SDL_Bonds\"><\/span><b>Diversify Your Fixed-Income Portfolio With <\/b><b>SDL Bonds<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\"> are no longer an investment option reserved only for institutional investors. Even retail investors like yourself can purchase <\/span><span style=\"font-weight: 400;\">SDL through RBI Retail Direct<\/span><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">SDLs have been overlooked for far too long. Now that you know what they are and their various benefits, consider including them in your fixed-income portfolio. You can benefit from higher <\/span><span style=\"font-weight: 400;\">SDL yields<\/span><span style=\"font-weight: 400;\"> compared to G-Secs issued by the central government of India and significantly lower risk compared to corporate bonds.\u00a0\u00a0<\/span><\/p>\n<p><a href=\"https:\/\/goldenpi.com\/\"><span style=\"font-weight: 400;\">GoldenPi<\/span><\/a><span style=\"font-weight: 400;\"> lets you build a customised fixed-income portfolio in just a few minutes. You can find SDLs, G-Secs, and <\/span><a href=\"https:\/\/goldenpi.com\/corporate-bonds\"><span style=\"font-weight: 400;\">corporate bonds<\/span><\/a><span style=\"font-weight: 400;\"> across different credit ratings on the platform. Additionally, you can also browse through various <\/span><a href=\"https:\/\/goldenpi.com\/fixed-deposits\"><span style=\"font-weight: 400;\">fixed deposit<\/span><\/a><span style=\"font-weight: 400;\"> options offered by RBI-regulated banks.\u00a0\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"FAQs_on_State_Development_Loans_in_India\"><\/span><b>FAQs on State Development Loans in India\u00a0<\/b><b><\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><b>Are <\/b><b>SDL bonds<\/b><b> different from G-Secs?\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">State Development Loans are not different from G-Secs. In fact, they are a type of government security issued by the Reserve Bank of India (RBI) on behalf of the various state governments of India. SDLs are issued by individual state governments to finance developmental activities and reduce fiscal deficits.\u00a0\u00a0<\/span><b><\/b><\/p>\n<h3><b>Why do <\/b><b>State Development Loans in India<\/b><b> offer higher yields?\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">SDL yield<\/span><span style=\"font-weight: 400;\">s are often higher because the bonds have lower liquidity, marginally higher credit risk, and demand-supply imbalances compared to G-Secs issued by the central government of India. SDLs offer higher yields to compensate investors for taking on the increased risk and low liquidity.<\/span><b><\/b><\/p>\n<h3><b>Are SDLs safe for retail investors?\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">In terms of safety, <\/span><span style=\"font-weight: 400;\">State Development Loans in India<\/span><span style=\"font-weight: 400;\"> are ranked just below G-Secs issued by the central government of India. Since they are backed by individual state governments, they carry a low risk of default. This makes <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> ideal for retail investors looking for long-term fixed income investments.<\/span><b><\/b><\/p>\n<h3><b>How can retail investors buy SDL bonds in India?\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">Retail investors can invest in an <\/span><span style=\"font-weight: 400;\">SDL through the RBI Retail Direct<\/span><span style=\"font-weight: 400;\"> platform. Alternatively, you can also browse through and purchase State Development Loans through a SEBI-registered debt broker like GoldenPi.\u00a0\u00a0\u00a0\u00a0\u00a0<\/span><\/p>\n<h3><b>How are the returns from an SDL taxed?\u00a0<\/b><\/h3>\n<p><span style=\"font-weight: 400;\">The interest payments from <\/span><span style=\"font-weight: 400;\">SDL bonds<\/span><span style=\"font-weight: 400;\"> are taxed at the income tax slab rate applicable to you. If you sell an SDL on the secondary market within one year of purchase, the profits are categorised as short-term capital gains (STCG). The STCG is added to your total income and taxed at the income tax slab rate applicable to you.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Meanwhile, if you sell an SDL on the secondary market after one year of purchase, the profits are categorised as long-term capital gains (LTCG). The LTCG is taxed at a flat rate of 12.5% without any indexation benefits.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Disclaimer\"><\/span><b>Disclaimer:<\/b><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">This information is for general information purposes only. GoldenPi makes no guarantee on the accuracy of the data provided here; the information displayed is subject to change and is provided on an as-is basis. Nothing contained herein is intended to or shall be deemed to be investment advice, implied or otherwise. Investments in the securities market are subject to market risks. Read all the offer-related documents carefully before investing.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Fixed Deposit schemes are regulated by the Reserve Bank of India. GoldenPi Securities Private Limited is a registered debt broker and acts as a distributor and not as a manufacturer of the product.<\/span><br \/>\n<script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@graph\": [\n    {\n      \"@type\": \"BlogPosting\",\n      \"mainEntityOfPage\": {\n        \"@type\": \"WebPage\",\n        \"@id\": \"https:\/\/goldenpi.com\/blog\/investment-guide\/state-development-loans-sdl\"\n      },\n      \"headline\": \"State Development Loans (SDLs) in India: Higher Yields and Low Risk\",\n      \"description\": \"An in-depth guide to State Development Loans (SDLs) in India, exploring how they differ from central G-Secs, their benefits, and how retail investors can purchase them.\",\n      \"image\": \"https:\/\/goldenpi.com\/blog\/wp-content\/uploads\/your-featured-image.jpg\",\n      \"author\": {\n        \"@type\": \"Person\",\n        \"name\": \"Rohit Suhag\",\n        \"url\": \"https:\/\/goldenpi.com\/blog\/author\/rohit_suhag\/\",\n        \"jobTitle\": \"Author\",\n        \"worksFor\": {\n          \"@type\": \"Organization\",\n          \"name\": \"GoldenPi\"\n        }\n      },\n      \"publisher\": {\n        \"@type\": \"Organization\",\n        \"name\": \"GoldenPi\",\n        \"url\": \"https:\/\/goldenpi.com\/\",\n        \"logo\": {\n          \"@type\": \"ImageObject\",\n          \"url\": \"https:\/\/d2tfvseypdp8pf.cloudfront.net\/assets\/img\/logo.svg\"\n        }\n      },\n      \"mainEntity\": {\n        \"@type\": \"FinancialProduct\",\n        \"name\": \"State Development Loans (SDLs)\",\n        \"brand\": {\n          \"@type\": \"GovernmentOrganization\",\n          \"name\": \"Reserve Bank of India\",\n          \"sameAs\": \"https:\/\/en.wikipedia.org\/wiki\/Reserve_Bank_of_India\"\n        }\n      },\n      \"about\": [\n        {\n          \"@type\": \"Thing\",\n          \"name\": \"Government Security\",\n          \"sameAs\": \"https:\/\/en.wikipedia.org\/wiki\/Government_bond#India\"\n        },\n        {\n          \"@type\": \"Thing\",\n          \"name\": \"Fiscal Deficit\",\n          \"sameAs\": \"https:\/\/en.wikipedia.org\/wiki\/Fiscal_deficit\"\n        }\n      ]\n    },\n    {\n      \"@type\": \"FAQPage\",\n      \"mainEntity\": [\n        {\n          \"@type\": \"Question\",\n          \"name\": \"Are SDL bonds different from G-Secs?\",\n          \"acceptedAnswer\": {\n            \"@type\": \"Answer\",\n            \"text\": \"State Development Loans are not different from G-Secs. 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