Inclusion of Rupee Bonds Issued by New Development Bank in Eligible Investment Universe under NPS – PFRDA Circular dated 13.05.2026

Admin | Sunday, May 17, 2026

The Pension Fund Regulatory and Development Authority has issued Circular No. PFRDA/2026/29/REG-PF/06 dated 13.05.2026 regarding the inclusion of Rupee Bonds issued by the New Development Bank (NDB) in the eligible investment universe under the National Pension System (NPS).

This decision has been taken pursuant to the in-principle approval granted by the Department of Economic Affairs, Ministry of Finance, Government of India, for issuance of INR-denominated bonds by the New Development Bank

Key Highlights of the PFRDA Circular

• Rupee Bonds issued by the New Development Bank (NDB) have now been included as eligible investment instruments under NPS investment guidelines.

• The amendment applies to both:

  • Government Sector Investment Guidelines

  • Non-Government Sector Investment Guidelines

• Existing investment conditions such as:

  • Minimum credit rating requirement of AA or above

  • Applicable maturity specifications
    will continue unchanged.

• The circular comes into force with immediate effect.

Amendment in Investment Guidelines

1. Government Sector Investment Guidelines

Under Category ii(c) of Debt Instruments and Related Investments, the earlier provision allowed investments in:

• International Bank for Reconstruction and Development (IBRD)

• International Finance Corporation (IFC)

• Asian Development Bank (ADB)

Now, the following institution has also been added:

• New Development Bank (NDB)

2. Non-Government Sector Investment Guidelines

Under Category (b) of Scheme / Asset Class C, the same amendment has been carried out.

Eligible Rupee Bonds now include those issued by:

• International Bank for Reconstruction and Development (IBRD)

• International Finance Corporation (IFC)

• Asian Development Bank (ADB)

• New Development Bank (NDB)

What is the New Development Bank (NDB)?

The New Development Bank is a multilateral development bank established by the BRICS nations — Brazil, Russia, India, China and South Africa — to support infrastructure and sustainable development projects in emerging economies.

The inclusion of NDB-issued Rupee Bonds under NPS investment norms is expected to:

• Broaden the investment universe for Pension Funds

• Enhance diversification opportunities

• Provide additional high-quality debt instruments for NPS investments

Important Conditions Continue

PFRDA has clarified that all existing safeguards under investment guidelines remain applicable, including:

• Minimum credit rating of AA or above

• Prescribed maturity norms

• Existing prudential investment limits

Effective Date

The provisions of this circular are effective immediately from 13.05.2026.

Official Details

• Circular No.: PFRDA/2026/29/REG-PF/06

• Date: 13 May 2026

• Issued by: Ashok Kumar Soni

Reference Master Circulars

1. Master Circular on Investment Guidelines for UPS/NPS/APY Schemes – Central/State Government, Corporate CG, NPS Lite and APY Fund Scheme dated 10.12.2025.

2. Master Circular on Investment Guidelines under NPS in Non-Government Sector dated 10.12.2025.

Conclusion

The inclusion of Rupee Bonds issued by the New Development Bank marks another important step towards expanding and diversifying the investment framework under NPS. By allowing investments in NDB-issued bonds, PFRDA aims to provide pension funds access to additional high-quality debt instruments while maintaining existing prudential safeguards and credit standards.

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