..........Thus, it promises vaguely to disclose the product structure of the bonds later in the year. Apparently, it does not even know what the valuation of the bonds will be. The value of a bond is normally the price at which it is quoted in the market. But the RBI does not expect that its innovative bonds will be traded soon in the market; it hopes that some valuation guidelines will be issued by the Fixed Income Money Market and Derivatives Association of India. This vagueness may not bother the personal investor unduly, for he may well keep away from indexed bonds until some market experience of them accumulates. But banks will be concerned, for the RBI has made them eligible for investment in inflation bonds..........
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