SEBI has decided to set up a corporate debt market

Solution

  SEBI has decided to set up a corporate debt market development fund in the form of an AIF with an initial corpus of Rs 3,000 crore to act as a backstop facility for purchase of investment grade corporate debt securities during times of stress.   The move is aimed at instilling confidence amongst the participants in the corporate bond market and to generally enhance secondary market liquidity.     The government has allowed a 10x usage of this corpus to be availed taking the available fund to Rs 33,000 crore and this additional corpus is also guaranteed by the central credit guarantee corporation.    CDMDF, based on a guarantee to be provided by National Credit Guarantee Trust Company (NCGTC) may raise funds, for purchase of corporate debt securities during market dislocation.