Restricting the proportion of borrowings by large corporates from banks and making such corporates use the market mechanism (such as, corporate bonds, commercial papers and other instruments) to meet a part of their short term as well as long term financing needs will help in the development of corporate bonds markets.
Reserve Bank has already issued a Discussion Paper on “Large Exposures Framework and Enhancing Credit Supply through Market Mechanism” on March 27, 2015. Resolving distribution tax related issue for securitization 22. Securitization of the corporate debt instruments would provide a big fillip to the market as it would improve risk transference and diversification and provide liquidity to the issuers.