The development of the G-sec market was greatly facilitated by the abolition of automatic monetization of government debt, introduction of the auction process for issuance and enactment of FRBM Act, 2003.
The next phase of reforms was directed towards institutional development, including the institution of Primary Dealers (PDs); establishment of the Clearing Corporation of India Ltd. (CCIL) – a central counterparty for guaranteed settlement – and formation of market bodies such as the FIMMDA and the PDAI.