What will be the advantage of inclusion in the Bond index for India?

Inclusion in global indices leads to passive inflows from global investors. It is estimated that India could $40 billion of debt flows in first 2 years and $250 billion in 10 years. That would be more balanced considering FPIs hold $655 billion in equities. Once passive funds come in, the active fund managers tend to follow as markets become liquid. Thus index inclusion will not only boosts passive flows, but also indirectly boosts active flows into Indian bonds.