Bonds 101: A Complete Guide to G-Secs, Corporate and Tax-Free Bonds in India

They carry effectively zero credit risk, since the Government of India backs them. They still carry interest-rate risk — if you sell before maturity when rates have risen, the market price can be below what you paid. Holding to maturity removes that risk entirely.

The platform is built around resident Indian investors with a PAN and Aadhaar-linked bank account. NRI eligibility and process differ — check the current RBI Retail Direct terms before assuming access.

No major new tranches have come to market in recent years. What's available is what already exists in the secondary market from PSU issuances made mostly between 2012 and 2016.

It varies a great deal by issue. Bonds from large, frequently traded issuers on the exchanges or major bond platforms are reasonably liquid; smaller or older issues can be thin, sometimes forcing a discount to sell quickly. Check recent trading volumes before you buy, not after.

No — interest from G-Secs and corporate bonds is added to your total income and taxed at whichever slab rate applies to you, under either the old or new regime. Tax-free bond interest stays exempt under Section 10 in both regimes.

Coupon rate is fixed at issuance and calculated on face value. Yield is your actual return based on what you paid — if you buy below face value your yield is higher than the coupon, and if you buy above face value (common for sought-after tax-free bonds) your yield is lower than the coupon.

They fall. A bond's coupon is fixed, so when new bonds offer higher yields, older ones trade lower until their yield matches. Longer maturities fall more. In early October 2026 the 10-year G-Sec yield rose to about 7.2-7.3% after the RBI raised the repo rate to 5.50%, so existing long bonds lost value. If you hold to maturity, you still get face value back.