Infrastructure plays an important role in development of markets and want of an efficient, transparent and robust infrastructure can keep market participants away on one extreme or cause market crisis on the other. Reserve Bank of India has pursuing a strategy for creation of an efficient market infrastructure to enhance market activity and also to create a supporting institutional framework.
In the government bond market, a state of the art primary issuance process with electronic bidding and fast processing capabilities, an efficient, completely dematerialized depository system, Delivery-versus-Payment (DvP) mode of settlement, Real Time Gross Settlement (RTGS), electronic trading platforms (Negotiated Dealing Systems and Negotiated Dealing Systems-Order Matching) and a separate Central Counter Party (CCP) in the Clearing Corporation of India Ltd (CCIL) for guaranteed settlement are among the steps that were taken by the Reserve Bank over the years towards this end.