INTRODUCTION

The debt market is one of the most critical of the financial system of any economy and acts as
the fulcrum of a modern financial system. The debt market in most developed countries is many
times bigger than the other financial markets. Including the equity market. The US bond market
is more than USD 35 trillion in size with a turnover exceeding 500 billion daily, representing the
largest securities market in the world The size of the world bonds market is close to USD 47
trillion which is nearly equivalent to the total GDP of all the countries in the world.
The total size of the Indian debt market is currently estimated to be in the range of USD 150
billion to 200 billion. India’s debt market accounts for approximately 30 per cent of its GDP. The
Indian bond market, measured by the estimated value of the bond outstanding, is next only to the
Japanese and Korean bond markets in Asia. The Indian debt market in terms of volume.is larger
than the equity market. In terms of the daily settled deals, the debt and the forex markets
currently (2008-09) command a volume of Rs.1,40,000 crore against a meagre Rs. 20,000 crore
in the equity markets (including equity derivatives).
In the post-reforms era, a fairly well- segmented debt market has emerged comprising the
following
 Private corporate debt market
 Public sector undertaking bond market
 Government securities market
The government securities market accounts for more than 90 per cent of the turnover in the debt
market. It constitutes the principal segment of the debt market.

The debt market is a market where fixed income securities of various types and features are
issued and traded