In a bid to deepen financial markets, the government is considering a proposal to allow companies to issue depository receipts such as American depository receipt (ADR) and global depository receipt (GDR) against debt instruments. Presently, Indian companies issue ADR and GDR to foreign investors against equity. I.e. underlying value of shares.
The finance ministry is mainly working on broadening the ambit for issuance of foreign-listed securities by Indian firms against debt and is also considering the option of giving ADR and GDR holders voting right to make such securities more lucrative to foreign investors.
This development comes right after Finance Minister P Chidambaram in the interim budget speech said that the government would comprehensively revamp the American depository receipt and global depository receipt scheme and enlarge the scope of depository receipts. Additionally, the minister also underscored that government would take a number of steps to energize and deepen the country's corporate bond as well as currency derivatives market.