G20 push: Over 30 big cities on list to tap municipal bond market

Context: The Centre has identified more than 30 cities with good ratings in the Municipal (Muni) bond market. Surat and Visakhapatnam are likely to issue Muni bonds soon and Chennai could be the first of the megacities to do so this year.

Previously: Indore Municipal Corporation has become the first in India to issue the Green Bonds on the National Stock Exchange.

Also, recently (February 2023), NSE’s Index services subsidiary, NSE Indices limited has launched India’s first ever Municipal Bond Index, Nifty India Municipal Bond Index. It would tracks the performance of municipal bonds issued by Indian municipal corporations across maturities and having investment grade credit rating. 


  • In 2023 Union Budget, Finance Minister announced steps for cities to issue Muni bonds.
  • Centre has been holding workshops with states on side-lines of G20 infra groups meetings. The selected cities are rationalising property tax rates,  cleaning up their  books, and planning revenue-generating projects.
  • Government is also conducting regular workshops with states and municipal authorities on the side-lines of the G20 Infrastructure working group meetings
  • The annual Muni bond market size in India is not even $1 billion against $386 billion in USA.

These 30-plus cities rated ‘A’ are the ones that have done the most work, in rationalising property tax rates, cleaning up their books, planning revenue-generating projects, etc. 

About Muni Bonds

Municipal bonds (also known as Muni Bonds) are the bonds issued by Urban Local Bodies (ULB) to raise money for the development of various capital-intensive infrastructure projects. In India, the Bengaluru Municipal Corporation issued municipal bonds for the first time in 1997.


  • General obligation bonds: Can be used for creation and upgradation of any infrastructure. The money raised through such Bonds is repaid from the overall revenues earned by the ULBs.
  • Revenue Bonds: The money raised through these Bonds can be used for a specific infrastructure project such as Construction of new Road. The money raised through such Bonds is repaid only through the revenue earned from such as specific infrastructure project.

G20 Infrastructure Working Group meeting

  • First such meeting was organised in Pune this year in January where 18 nations participated. 
  • It discussed the 2023 Infrastructure Agenda under the Indian G20 Presidency.
  • Theme of the meeting was “Financing Cities of Tomorrow- Inclusive, Resilient and Sustainable”. 
  • The meeting included discussions on various facets of making cities economic centres of growth, financing urban infrastructure, building future-ready urban infrastructure, the role of cities in meeting sustainability targets, directing fiscal investments for unlocking private financing for energy-efficient and environmentally sustainable infrastructure and mitigating social imbalances.
  • The second meeting of the Infrastructure Working Group is scheduled to be held in Vishakhapatnam, Andhra Pradesh, on 28th and 29th of March, 2023.

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