FPIs have cited lack of information on financial position of states between two budgets, and opacity of State Government (SG) 6  operations as one of the main reasons for lackluster interest in SDLs, despite the yields they have to offer.
The argument here is that what matters for the real economy is lending rates and availability of finance. While monetary policy affects both, regulation can improve the access to credit and terms of credit. Second, faith in the invisible hand and excessive reliance on market efficiency should not blind side central banks to the possibility of market failures.