ETMarkets Smart Talk| RBI's FPI reforms could attract $50-100 billion into Indian debt over time: Vikas Garg of Invesco MF

Vikas Garg of Invesco MF believes RBI's FPI reforms—including removal of key investment restrictions and expansion of the Fully Accessible Route (FAR) universe—could attract $50-100 billion into Indian debt over time, especially with potential Bloomberg Global Bond Index inclusion. On monetary policy, he states the rate-cut cycle is effectively over, with the RBI holding repo rate at 5.25% and revising FY27 inflation projection upward by 50 bps to 5.1% (assuming crude at USD 95/barrel). Garg warns that every USD 10/barrel rise in crude could push inflation up 40-45 bps, widen CAD by ~40 bps, and dent growth by 10-15 bps, with future rate hikes possible if West Asia conflict intensifies.