Question

As per RBI’s new guidelines, what is the minimum outstanding amount required for state government bonds to be eligible for STRIPS trading?

Q: Answer-As per RBI&rsquo;s new guidelines, what is the minimum outstanding amount required for state governm...

The RBI has extended STRIPS trading to state government bonds, aligning with central government securities. For a bond to qualify, it must have a minimum outstanding amount of 10 billion , be a fixed-coupon bond, and have a residual maturity of up to 14 years. STRIPS allow the principal and interest portions of bonds to be traded separately, enhancing liquidity and debt management flexibility.