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176 Corporate Finance BRILLIANT’S

OR
What is the International Bond Market? Enumerate the important features of this Market.
A§Vam©ï´>r¶ ~m§S> ‘mH}$Q> ³¶m h¡? Bg ~mOma Ho$ ‘hÎdnyU© JwUm| H$m dU©Z H$s{OE&
All the requirements of an individual H$moB© ^r ì`{º$ AnZr ñd`§ H$s g^r Amdí`H$VmAm|
cannot be fulfilled by his own. He needs to H$mo nyam Zht H$a gH$Vm h¡Ÿ& Cgo AnZo JwS²>g Am¡a g{d©gog
exchange his goods and services with other H$mo AÝ` ì`{º$`m| go EŠgM|O H$aZm Oê$ar hmoVm h¡Ÿ& R>rH$
individuals. In the same manner, a country Cgr àH$ma, EH$ Xoe AnZo gmog}g Ûmam AnZr gmar Oê$aVm|
cannot fulfil all its requirement by its own
H$mo nyam Zht H$a gH$Vm h¡, Cgo AÝVam©ï´>r` ñVa na Xygao
sources. It has to depend on other countries
internationally. The dependency of one country Xoem| na {Z^©a ahZm n‹S>Vm h¡Ÿ& EH$ Xoe H$s Xygao Xoe na
to another is mainly due to odd distribution of {Z^©aVm àmH¥${VH$ g§gmYZm| Ho$ Ag_mZ {dVaU Ho$
natural resources. n[aUm_ñdê$n hmoVr h¡Ÿ&
Due to this dependency, it has become Bg {Z^©aVm Ho$ H$maU, Xoem| H$m B§Q>aZoeZc _mH}$Q> _|
necessary for countries to enter in interna- àdoe H$aZm Amdí`H$ hmo OmVm h¡Ÿ& `{X H$moB© Xoe ½cmo~c
tional market. If a country fails to become a _mH}$Q> H$m {hñgm ~ZZo _| Ag\$c hmoVm h¡ Vmo dh CgHo$
part of the global market, it will be left behind J«moW Am¡a ñQ>¡ÊS>S²>©g Ho$ g§X^© _| H$m\$s nrN>o hmo Om`oJmŸ&
in terms of its growth and standards. Successful
participation in international market improves B§Q>aZoeZc _mHo©$Q> _| g\$c {hñgoXmar cmB\$ H$s Šdm{cQ>r
quality of life, creates a better society and a gwYmaVr h¡ Am¡a EH$ em§{VnyU© {díd Am¡a ~ohVa g_mO H$m
peaceful world. {Z_m©U H$aVr h¡Ÿ&
The main objectives of raising of BÝQ>aZoeZc _mH}$Q> go [agmog}g àmßV H$aZo Ho$
resources from international market are: _w»` CÔoí` {ZåZ h¢:
1. To meet the requirements of foreign 1. B§nmoQ>©, EŠgnm§eZ VWm AÝ` {~OZog CÔoí`m| Ho$ {cE
currency for import, expansion and other \$m°aoZ H$a§gr H$s Amdí`H$Vm H$s ny{V© H$aZo Ho$ {cE&
business purposes.
2. To lower the overall cost of capital as 2. AmodaAm°b H$m°ñQ> Am°\$ H¡${nQ>c H$mo H$_ H$aZm Š`m|{H$
international resources are cheaper in B§Q>aZoeZc [agmog©og ^maV _| gñVo h¢Ÿ&
India.
Since, the beginning of economic planning, My§{H$, BH$moZm°{_H$ ßcmqZJ H$s ewéAmV _|, ^maV _|
the perception and policy towards foreign B§S>pñQ´>`c Am¡a AmodaAm°b J«moW H$s àmogog _| \$m°aoZ H¡${nQ>c
capital in the process of industrial and overall
Ho$ à{V nagoßeZ Am¡a nm°{cgr ~Xc MwH$s WrŸ& gaH$ma Zo
growth have changed in India. The government
\$m°aoZ BÝdoñQ>_|Q> H$mo AmH${f©V H$aZo Ho$ {cE H$B© nm°{c{g`m|
has introduced a number of policy measures
to attract foreign investments. The foreign go AdJV H$am`mŸ& \$m°aoZ H¡${nQ>c CÎm_ {\${OH$c Am¡a
capital provides superior physical and _¡ZoO[a`c Q>oŠZmocm°Or àmodmBS> H$aZo Ho$ gmW-gmW \$m°aoZ
managerial technology as well as fills the gap EŠgM|O ~¡[a`g© (AdamoYH$mo§) H$mo H$_ H$aHo$ S>mo_opñQ>H$
in domestic savings to reduce the foreign
exchange barriers. The major determinants of goqd½g _| [a{º$`m§ (Jon) ^aVr h¡Ÿ& \$m°aoZ H¡${nQ>c âcmo Ho$
foreign capital flows are: à_wI {ZYm©aH$ h¢:
1. Current Account Gaps 1. dV©_mZ AH$mCÝQ> J¡ßg
2. Relative, Interest Rates and Profitability 2. g§~§{YV B§Q>aoñQ> aoQ²>g VWm àm°{\$Q>o{~{cQ>r