He added that there is potential for currency appreciation following the inclusion of Indian bonds in the JPMorgan index.
JPMorgan has said it plans to incorporate Indian government bonds or government securities into its benchmark emerging market index from June 2024, a move that will lower borrowing costs for the government.
The inclusion of G-Secs will be staggered over a 10-month period from June 28, 2024 to March 31, 2025, indicating one percent increase in its index weight.
Nageswaran said that the move was a step in the direction of boosting India's economy.
He said the value of the currency has been on a decline since the capital inflows into India surged from 2003 to 2008, when capital inflows surged.