{"id":16717,"date":"2026-10-24T16:43:29","date_gmt":"2026-10-24T11:13:29","guid":{"rendered":"https:\/\/goldenpi.com\/blog\/?p=16717"},"modified":"2026-10-22T18:09:48","modified_gmt":"2026-10-22T12:39:48","slug":"maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india","status":"publish","type":"post","link":"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/","title":{"rendered":"Maharajah Bonds Explained: How Multilaterals Issue Rupee Debt in India"},"content":{"rendered":"<div class=\"gpi-custom-widget-box\" style=\"border-left-color: #0066cc; background-color: #f0f7ff;\">\n<div class=\"gpi-custom-widget-title\" style=\"color: #0066cc;\">Quick Summary:<\/div>\n<h2 class=\"gpi-custom-widget-h2-content\"><span class=\"ez-toc-section\" id=\"This_explainer_covers_what_Maharajah_bonds_are_how_they_differ_from_masala_bonds_how_multilaterals_like_the_International_Finance_Corporation_IFC_and_the_New_Development_Bank_NDB_issue_rupee_debt_in_India_and_what_the_latest_TDS_exemption_means_for_investors\"><\/span><strong>This explainer covers what Maharajah bonds are, how they differ from masala bonds, how multilaterals like the International Finance Corporation (IFC) and the New Development Bank (NDB) issue rupee debt in India, and what the latest TDS exemption means for investors.<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<\/div>\n\n\n<p>If you track India\u2019s debt market, Maharajah bonds are suddenly hard to miss. On 19 October 2026, the Central Board of Direct Taxes (CBDT) notified that interest on the New Development Bank\u2019s (NDB) Maharajah rupee bonds will no longer attract TDS from the 2026-27 tax year. That came weeks after the insurance regulator cleared these bonds for insurers. So what exactly are Maharajah bonds, and why do multilaterals like the NDB and the International Finance Corporation (IFC) issue rupee debt in India? This guide explains how they work, how they differ from Masala Bonds, and what they mean for Indian investors.<\/p><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 eztoc-toggle-hide-by-default' ><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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#This_explainer_covers_what_Maharajah_bonds_are_how_they_differ_from_masala_bonds_how_multilaterals_like_the_International_Finance_Corporation_IFC_and_the_New_Development_Bank_NDB_issue_rupee_debt_in_India_and_what_the_latest_TDS_exemption_means_for_investors\" >This explainer covers what Maharajah bonds are, how they differ from masala bonds, how multilaterals like the International Finance Corporation (IFC) and the New Development Bank (NDB) issue rupee debt in India, and what the latest TDS exemption means for investors.<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#What_Are_Maharajah_Bonds_and_How_Do_They_Differ_From_Masala_Bonds\" >What Are Maharajah Bonds, and How Do They Differ From Masala Bonds<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#Why_Do_Multilaterals_Borrow_in_Rupees\" >Why Do Multilaterals Borrow in Rupees?<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#From_IFC_to_NDB_How_the_Maharajah_Story_Unfolded\" >From IFC to NDB: How the Maharajah Story Unfolded<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#How_Do_Multilaterals_Issue_Rupee_Bonds_in_India\" >How Do Multilaterals Issue Rupee Bonds in India?<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#What_Changed_in_2026_IRDAI_CBDT_and_Tax_Relief\" >What Changed in 2026: IRDAI, CBDT, and Tax Relief<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#Why_Investors_Care_and_What_to_Watch\" >Why Investors Care, and What to Watch<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#The_Bottom_Line\" >The Bottom Line<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#Maharajah_Bonds_Frequently_Asked_Questions\" >Maharajah Bonds Frequently Asked Questions<\/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\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#Sources\" >Sources<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/#Disclaimer\" >Disclaimer<\/a><\/li><\/ul><\/nav><\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Are_Maharajah_Bonds_and_How_Do_They_Differ_From_Masala_Bonds\"><\/span><strong>What Are Maharajah Bonds, and How Do They Differ From Masala Bonds<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p><a href=\"https:\/\/goldenpi.com\/blog\/bond-news\/cbdt-exempts-interest-on-ndbs-maharajah-bonds-from-tds\/\" type=\"post\" id=\"16693\">Maharajah bonds<\/a> are rupee-denominated bonds issued in India\u2019s domestic market by a foreign or multilateral issuer. The issuer is global, but the bond is an Indian-market instrument. It is priced and settled in rupees, listed on an Indian exchange such as the NSE, and governed by domestic rules.<\/p>\n\n\n\n<p>IFC\u2019s 2014 debut Maharajah Bond issuance <sup>[1]<\/sup> was described as India\u2019s first international AAA-rated issuance. It came in four tranches, including 5-year and 10-year bullet bonds and two separately tradable redeemable principal parts (STRPPs) maturing in 13 to 20 years. That range of maturities, from five years to as long as twenty, let IFC reach investors with different time horizons, and officials pitched the programme as a safe option for domestic pension funds. For an Indian institution, it feels like any other corporate bond, except the issuer is a global development lender.<\/p>\n\n\n\n<p>Now to the term that often gets confused with it. Masala bonds are also rupee-denominated, often from the same issuers. IFC, for instance, sold the first rupee bonds listed on the London Stock Exchange shortly after its Maharajah debut. The difference is where the bond is sold and who carries the currency risk. Masala bonds go to global investors, who fund them in foreign currency and so bear the rupee\u2019s swings. A Maharajah bond is sold at home, mostly to domestic institutions, so an Indian buyer takes no currency risk at all.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><div class=\"pcrstb-wrap\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Feature<\/strong><\/td><td><strong>Maharajah Bonds<\/strong><\/td><td><strong>Masala Bonds<\/strong><\/td><\/tr><tr><td>Where issued<\/td><td>Indian domestic market<\/td><td>Overseas markets (e.g., London)<\/td><\/tr><tr><td>Currency<\/td><td>Indian rupee<\/td><td>Indian rupee<\/td><\/tr><tr><td>Typical investors<\/td><td>Mainly domestic institutions, plus eligible foreign investors<\/td><td>Global institutional investors<\/td><\/tr><tr><td>Listing<\/td><td>Indian exchanges such as NSE<\/td><td>Offshore exchanges such as LSE<\/td><\/tr><tr><td>Rupee risk<\/td><td>None for Indian investors; foreign holders still bear it<\/td><td>Borne by the overseas investor<\/td><\/tr><\/tbody><\/table><\/div><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_Do_Multilaterals_Borrow_in_Rupees\"><\/span><strong>Why Do Multilaterals Borrow in Rupees?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A development bank lending in India earns rupees. If it funds those loans with dollars, it takes on currency risk or pays for a hedge. Borrowing in rupees removes that mismatch.<\/p>\n\n\n\n<p>Say a multilateral lender lends \u20b91,000 crore to an Indian solar developer. If it borrowed in dollars and the rupee weakens, repayment costs more rupees. A rupee bond keeps both sides in the same currency. The NDB itself argues that local-currency financing reduces forex risk and helps deepen domestic capital markets. For India, it also adds a long-term source of rupee funding for infrastructure.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Latest Bond Updates:<\/h3>\n\n\n<ul class=\"wp-block-latest-posts__list is-grid columns-3 has-dates wp-block-latest-posts\"><li><div class=\"wp-block-latest-posts__featured-image aligncenter\"><a href=\"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/\" aria-label=\"Maharajah Bonds Explained: How Multilaterals Issue Rupee Debt in India\"><img decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained-1024x576.jpg\" class=\"attachment-large size-large wp-post-image\" alt=\"Maharajah Bonds Explained\" style=\"\" srcset=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained-1024x576.jpg 1024w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained-300x169.jpg 300w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained-768x432.jpg 768w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained-1536x864.jpg 1536w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained.jpg 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/a><\/div><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/\">Maharajah Bonds Explained: How Multilaterals Issue Rupee Debt in India<\/a><time datetime=\"2026-10-24T16:43:29+05:30\" class=\"wp-block-latest-posts__post-date\">October 24, 2026<\/time><\/li>\n<li><div class=\"wp-block-latest-posts__featured-image aligncenter\"><a href=\"https:\/\/goldenpi.com\/blog\/guide\/how-to-compare-two-bonds\/\" aria-label=\"How to Compare Two Bonds Side by Side: A 10-Point Checklist\"><img decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side-1024x576.jpg\" class=\"attachment-large size-large wp-post-image\" alt=\"How to Compare Two Bonds Side by Side\" style=\"\" srcset=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side-1024x576.jpg 1024w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side-300x169.jpg 300w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side-768x432.jpg 768w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side-1536x864.jpg 1536w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22121453\/How-to-Compare-Two-Bonds-Side-by-Side.jpg 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/a><\/div><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/goldenpi.com\/blog\/guide\/how-to-compare-two-bonds\/\">How to Compare Two Bonds Side by Side: A 10-Point Checklist<\/a><time datetime=\"2026-10-24T12:15:21+05:30\" class=\"wp-block-latest-posts__post-date\">October 24, 2026<\/time><\/li>\n<li><div class=\"wp-block-latest-posts__featured-image aligncenter\"><a href=\"https:\/\/goldenpi.com\/blog\/guide\/crar-explained-how-capital-adequacy-ratio-protects-nbfc-bond-investors\/\" aria-label=\"CRAR Explained: How Capital Adequacy Ratio Protects NBFC Bond Investors\"><img decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained-1024x576.jpg\" class=\"attachment-large size-large wp-post-image\" alt=\"CRAR Explained\" style=\"\" srcset=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained-1024x576.jpg 1024w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained-300x169.jpg 300w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained-768x432.jpg 768w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained-1536x864.jpg 1536w, https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/21184331\/CRAR-Explained.jpg 1600w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/a><\/div><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/goldenpi.com\/blog\/guide\/crar-explained-how-capital-adequacy-ratio-protects-nbfc-bond-investors\/\">CRAR Explained: How Capital Adequacy Ratio Protects NBFC Bond Investors<\/a><time datetime=\"2026-10-23T18:35:12+05:30\" class=\"wp-block-latest-posts__post-date\">October 23, 2026<\/time><\/li>\n<\/ul>\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"From_IFC_to_NDB_How_the_Maharajah_Story_Unfolded\"><\/span><strong>From IFC to NDB: How the Maharajah Story Unfolded<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Multilateral rupee-bond issuance in India has been relatively uncommon. The Asian Development Bank (ADB) entered India\u2019s domestic bond market in 2004 with a rupee bond issue worth approximately around \u20b9500 crore at the time (around $110 million) <sup>[2]<\/sup>. In September 2014, the IFC launched its maiden onshore Maharajah bonds, raising \u20b9600 crore ($100 million) and establishing an international AAA-rated benchmark. In February 2016, IFC reissued Maharajah Bonds worth approximately \u20b9180 crore (US$27 million) <sup>[3]<\/sup>, extending the size of the existing bond series.<\/p>\n\n\n\n<p>Now NDB, the BRICS-backed lender, is leading the next phase. In August, a senior NDB official said the bank was working on its first onshore rupee Maharajah bond with support from the Government of India and the RBI. Its proposed program of \u20b925,000 crore over five years is notably larger than IFC\u2019s, which was pegged at about \u20b915,000 crore.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_Do_Multilaterals_Issue_Rupee_Bonds_in_India\"><\/span><strong>How Do Multilaterals Issue Rupee Bonds in India?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The mechanics follow the domestic playbook, with a few special steps:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Regulatory approvals:<\/strong> The issuer typically needs clearance from the RBI and market regulators before launching a program.<\/li>\n\n\n\n<li><strong>Program structure:<\/strong> Issuers set a multi-year borrowing ceiling, then issue in tranches. IFC\u2019s debut had four tranches of different maturities.<\/li>\n\n\n\n<li><strong>Rating and listing:<\/strong> Bonds are usually rated and listed on an Indian exchange, which helps pricing and secondary trading.<\/li>\n\n\n\n<li><strong>Arrangers and investors:<\/strong> Banks and primary dealers place the bonds with institutions. IFC\u2019s debut used HSBC, ICICI Securities Primary Dealership, and SBI Capital Markets.<\/li>\n\n\n\n<li><strong>Use of proceeds:<\/strong> The money raised is passed on as loans to Indian projects. The NDB plans to use its proceeds for general corporate purposes, including onward lending for sustainable development, infrastructure, and green and social projects.<\/li>\n\n\n\n<li><strong>Swaps:<\/strong> IFC\u2019s program also combined rupee bonds with swaps to raise local-currency funds.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Changed_in_2026_IRDAI_CBDT_and_Tax_Relief\"><\/span><strong>What Changed in 2026: IRDAI, CBDT, and Tax Relief<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Two regulatory moves are significant for NDB\u2019s Maharajah INR Bonds.<\/p>\n\n\n\n<p>First, an IRDAI circular dated 27 August 2026 <sup>[4]<\/sup> permitted insurers to classify NDB\u2019s onshore rupee bonds as \u201capproved investments,&#8221; subject to applicable conditions, including rating requirements and regulatory limits. This expands the potential investor base for the bonds.<\/p>\n\n\n\n<p>Second, a CBDT notification dated 19 October 2026 <sup>[5]<\/sup> exempted interest payments on eligible Maharajah INR Bonds from tax deduction at source (TDS). The exemption covers resident holders and qualifying foreign institutional investors from tax year 2026\u201327 onwards. However, the exemption is from TDS, not from income tax itself.<\/p>\n\n\n\n<p><strong>One caveat:<\/strong> This is not a tax-free return. Resident investors must still report the interest as taxable income under the Income-tax Act, 2025, and pay tax at applicable rates. TDS is only an advance collection. Whatever your slab, your post-tax yield doesn\u2019t improve. Only your cash timing does.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_Investors_Care_and_What_to_Watch\"><\/span><strong>Why Investors Care, and What to Watch<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For institutions, the appeal is a multilateral-issued rupee asset that can diversify a book heavy on G-secs and <a href=\"https:\/\/goldenpi.com\/collections\/psu-bonds\">PSU bonds<\/a>. IFC\u2019s 2014 debut shows how strong demand can be for top-rated foreign names, as IFC said it was the first domestic bond priced below the government bond benchmark curve.<\/p>\n\n\n\n<p>Still, a few things deserve a close look. Check each programme\u2019s own credit rating rather than assuming they\u2019re equivalent to IFC\u2019s AAA. Scarcity can mean thin yields, so compare spreads over G-secs. Smaller issues can trade thinly, which matters if you may need to exit early. Regulatory treatment is also evolving, as the NDB has pushed for zero risk weight in local currency, along with preferential tax and liquidity treatment. Finally, a programme ceiling is not an issuance, so watch actual tranche sizes and tenors.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_Bottom_Line\"><\/span><strong>The Bottom Line<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Maharajah Bonds let multilaterals fund India\u2019s growth in India\u2019s own currency and give domestic investors a rare, foreign-issuer rupee alternative. With insurer access and TDS relief in place, the NDB\u2019s program could be the most significant test yet of this market. Whether it scales will depend on pricing, depth, and further regulatory support.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Maharajah_Bonds_Frequently_Asked_Questions\"><\/span><strong>Maharajah Bonds Frequently Asked Questions<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1792666737078\"><strong class=\"schema-faq-question\">Q1. <strong>What are Maharajah Bonds?<\/strong><\/strong> <p class=\"schema-faq-answer\">Maharajah Bonds are rupee-denominated bonds issued by the New Development Bank (NDB) in India\u2019s domestic market. They allow the multilateral development bank to raise funds in Indian rupees for development financing, including eligible infrastructure and sustainability-related projects.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1792666750467\"><strong class=\"schema-faq-question\">Q2. <strong>What is the difference between Maharajah Bonds and government bonds?<\/strong><\/strong> <p class=\"schema-faq-answer\">Government bonds are issued by the Government of India or other eligible government issuers. Maharajah Bonds are debt obligations of NDB, a multilateral development bank. They should not be treated as Indian government securities or assumed to carry a sovereign guarantee unless the specific documentation explicitly provides one.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1792666762622\"><strong class=\"schema-faq-question\">3. <strong>What will NDB use the proceeds from Maharajah Bonds for?<\/strong><\/strong> <p class=\"schema-faq-answer\">NDB has described rupee-denominated funding as a way to support development financing in India. Proceeds may be used for eligible infrastructure, green, social or other development-related financing, subject to the final programme terms and the bank\u2019s stated use of funds.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1792666773806\"><strong class=\"schema-faq-question\">Q4. <strong>How can rupee-denominated bonds reduce currency risk?<\/strong><\/strong> <p class=\"schema-faq-answer\">When a project generates revenue in rupees and its borrowing is also denominated in rupees, the borrower may face less direct currency mismatch than if it borrowed in a foreign currency. This can reduce exposure to exchange-rate movements. The actual benefit depends on the project\u2019s revenues, expenses and financing structure.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1792666788498\"><strong class=\"schema-faq-question\">Q5. <strong>Are Maharajah Bonds safer than corporate bonds?<\/strong><\/strong> <p class=\"schema-faq-answer\">Their risk profile differs from that of corporate bonds because NDB is a multilateral development bank rather than a private-sector company. However, investors should not equate this distinction with a guarantee of repayment. They should review the issuer\u2019s credit standing, issue terms, currency, liquidity and any applicable guarantees or protections.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1792666800113\"><strong class=\"schema-faq-question\">Q6. <strong>What is the TDS exemption announced for Maharajah Bonds in October 2026?<\/strong><\/strong> <p class=\"schema-faq-answer\">A CBDT notification dated 19 October 2026 provides that tax should not be deducted at source on interest payments made by NDB to eligible holders of Maharajah INR Bonds for tax year 2026\u201327 and subsequent tax years. The notification identifies eligible holders as residents and foreign institutional investors, subject to its terms. Investors should refer to the notification for the precise scope of the exemption.<\/p> <\/div> <\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Sources\"><\/span><strong>Sources<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ol class=\"wp-block-list\">\n<li><a rel=\"nofollow\" href=\"https:\/\/nsearchives.nseindia.com\/content\/press\/23092014.htm\">NSE \u2014 IFC Debuts Maharajah Bonds, Setting Triple-A Benchmark for India\u2019s Domestic Capital Markets<\/a><\/li>\n\n\n\n<li><a rel=\"nofollow\" href=\"https:\/\/www.adb.org\/news\/features\/adb-and-local-currency-financing-20-year-journey\">ADB \u2014 ADB and Local Currency Financing: A 20-Year Journey<\/a><\/li>\n\n\n\n<li><a rel=\"nofollow\" href=\"https:\/\/economictimes.indiatimes.com\/markets\/bonds\/ifc-raises-rs-180-crore-via-rupee-denominated-maharaja-bonds\/articleshow\/50916099.cms\">The Economic Times \u2014 IFC raises \u20b9180 crore via rupee-denominated Maharajah bonds<\/a><\/li>\n\n\n\n<li><a rel=\"nofollow\" href=\"https:\/\/irdai.gov.in\/document-detail?documentId=9768288\">IRDAI \u2014 Investment in Maharajah INR Bonds issued by New Development Bank (NDB)<\/a><\/li>\n\n\n\n<li><a rel=\"nofollow\" href=\"https:\/\/egazette.gov.in\/WriteReadData\/2026\/277283.pdf\">CBDT \u2014 Notification No. 136\/2026, dated 19 October 2026<\/a><\/li>\n<\/ol>\n\n\n<div class=\"gpi-custom-widget-box\" style=\"border-left-color: #0066cc; background-color: #f0f7ff;\">\n<div class=\"gpi-custom-widget-title\" style=\"color: #0066cc;\">Ready to Invest?<\/div>\n<div class=\"gpi-custom-widget-content\">\n<p>Visit <a href=\"https:\/\/goldenpi.com\/\">GoldenPi<\/a> to explore current bond options. Compare yields, ratings, and tenures in one place and invest online with as little as \u20b930,000.<\/p>\n<\/div>\n<\/div>\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Disclaimer\"><\/span>Disclaimer <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Fixed returns do not constitute guaranteed or assured returns. Investments in corporate debt securities and municipal debt securities\/securitized debt instruments are subject to credit risks, market risks, and default risks, including delay and\/or default in payment. Read all the offer-related documents carefully. This blog\/article should not be construed as financial advice or as an offer or recommendation to buy or sell any security or any products\/services of\/on GoldenPi or any product\/services of its third-party client(s). For a detailed calculation of YTM, visit our website.&nbsp;<a href=\"https:\/\/delivery.goldenpi.com\/XPRBSN?id=162365=ch0GCFVXBVBUH1QDUlZXUlgBVgNSUwJVWgQGDFJQAVsEUwRfBldSBFVUAglRBFJSAA0ZBgxfQFBbERxBFSNTV10FU1cTDBgFDg5OAFIKVVFQBlZTVwQBBgFSAg0aC0BMQRIMFkwBUwoIFVdDHBwCCw1QAAsTWBpSVwgebDYxdmt\/Xl9dHxMF&amp;fl=WRVCSRBfGUkETltfVwNLAxVbCQwNWhpYVkpFGwMOBRcEWQMNUEoHSQJaV1BQAQQHTAZXA1IcAAMOBBxWB1IMFQUEVQxXXAEFBVQEUkpTVlMCUFEHU1JVAwhUAFECAQZaVFEADVAAVQBXVFRUUw==\" target=\"_blank\" rel=\"noreferrer noopener\">T&amp;C\u2019s Apply<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Quick Summary: This explainer covers what Maharajah bonds are, how they differ from masala bonds, how multilaterals like the International Finance Corporation&hellip;<\/p>\n","protected":false},"author":15,"featured_media":16720,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","footnotes":""},"categories":[1026,25],"tags":[],"class_list":["post-16717","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-guide","category-bond-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Maharajah Bonds Explained: How Multilateral Institutions Issue Rupee Bonds in India<\/title>\n<meta name=\"description\" content=\"Learn how Maharajah Bonds work, why multilateral institutions issue rupee-denominated debt in India, and how they differ from foreign currency bonds. Explore key features, benefits and risks for investors.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Maharajah Bonds Explained: How Multilateral Institutions Issue Rupee Bonds in India\" \/>\n<meta property=\"og:description\" content=\"Learn how Maharajah Bonds work, why multilateral institutions issue rupee-denominated debt in India, and how they differ from foreign currency bonds. Explore key features, benefits and risks for investors.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/goldenpi.com\/blog\/bond-news\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\/\" \/>\n<meta property=\"og:site_name\" content=\"GoldenPi | Blogs\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/goldenpitech\" \/>\n<meta property=\"article:published_time\" content=\"2026-10-24T11:13:29+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/d2zny4996dl67j.cloudfront.net\/blogs\/wp-content\/uploads\/2026\/10\/22165017\/Maharajah-Bonds-Explained.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1600\" \/>\n\t<meta property=\"og:image:height\" content=\"900\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Rohit Suhag | CA | IIM Calcutta\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@GoldenPiTech\" \/>\n<meta name=\"twitter:site\" content=\"@GoldenPiTech\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Rohit Suhag | CA | IIM Calcutta\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"8 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/\"},\"author\":{\"name\":\"Rohit Suhag | CA | IIM Calcutta\",\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/#\\\/schema\\\/person\\\/66765bf9cdaf773a3d329ac09c06f144\"},\"headline\":\"Maharajah Bonds Explained: How Multilaterals Issue Rupee Debt in India\",\"datePublished\":\"2026-10-24T11:13:29+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/\"},\"wordCount\":1728,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/#organization\"},\"image\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/d2zny4996dl67j.cloudfront.net\\\/blogs\\\/wp-content\\\/uploads\\\/2026\\\/10\\\/22165017\\\/Maharajah-Bonds-Explained.jpg\",\"articleSection\":[\"Guide\",\"Bond News\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#respond\"]}]},{\"@type\":[\"WebPage\",\"FAQPage\"],\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/\",\"url\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/\",\"name\":\"Maharajah Bonds Explained: How Multilateral Institutions Issue Rupee Bonds in India\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/d2zny4996dl67j.cloudfront.net\\\/blogs\\\/wp-content\\\/uploads\\\/2026\\\/10\\\/22165017\\\/Maharajah-Bonds-Explained.jpg\",\"datePublished\":\"2026-10-24T11:13:29+00:00\",\"description\":\"Learn how Maharajah Bonds work, why multilateral institutions issue rupee-denominated debt in India, and how they differ from foreign currency bonds. 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They allow the multilateral development bank to raise funds in Indian rupees for development financing, including eligible infrastructure and sustainability-related projects.\",\"inLanguage\":\"en-US\"},\"inLanguage\":\"en-US\"},{\"@type\":\"Question\",\"@id\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#faq-question-1792666750467\",\"position\":2,\"url\":\"https:\\\/\\\/goldenpi.com\\\/blog\\\/bond-news\\\/maharajah-bonds-explained-how-multilaterals-issue-rupee-debt-in-india\\\/#faq-question-1792666750467\",\"name\":\"Q2. What is the difference between Maharajah Bonds and government bonds?\",\"answerCount\":1,\"acceptedAnswer\":{\"@type\":\"Answer\",\"text\":\"Government bonds are issued by the Government of India or other eligible government issuers. Maharajah Bonds are debt obligations of NDB, a multilateral development bank. 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