Finance Ministry stated that the government successfully continues its multi-pronged approach to bridging its foreign financing needs and building foreign exchange reserves. Panda Bond approval by the Cabinet is a part of this strategy. This is a well thought-out decision after several rounds of discussions with; (1) Chinese Banks; (2) investment groups; (3) Regulatory Authorities in China and Stock Exchange and; (4) traditional Financial Advisors.
Panda bonds will help government diversify investor base of capital market issuance and provide a source of raising Renminbi. The size, tenor and pricing would be determined on the market response at the time of issuance. The issuances will be done in several rounds. A good response is expected considering the interest shown by Chinese banks and investment groups.