Bonds: Backlog builds as India reform hopes wane

This was the result of concerns over the current-account deficit, after data on October 12 showed India's trade deficit worsened to an all-time high of USD21bn.

There are also growing concerns about the government's ability to push through bold reforms announced in September.

Some of these key measures require parliamentary approval in the current month-long winter session that started on November 22, and opposition lawmakers have already created a logjam at the start over one of the key pieces of the reform, foreign direct investment in retail.

However, given the cut - from 2.0% to 5% - in withholding tax on overseas coupon payments of Indian companies and the success firms like NTPC, Bharat Petroleum and IRFC had achieved in the past few months, the country's borrowers are still preparing to tap the international market as soon as sentiment recovers.

ICICI Bank also underlined the depth of demand for Indian credits with a USD25.0m tap of its 4.7% bonds due 2.018 last week.

WAITING FOR RIGHT PRICE Pricing, however, may be a sticking point.

Power Finance Corp was expected to be the next Indian corporation to hit the market after ICICI Bank deal as it completed a roadshow last month.

PFC was said to have all the documents ready and a deal mandated.

However, the spread on IRFC's 2.017s, seen as one of the main comps, widened 25bp to Treasuries plus 26.0bp since the roadshow was announced a month ago.

Energy firm ONGC Videsh, the overseas investment

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