Infrastructure Bonds India: By
Infrastructure Bonds India or
Tax-Saving Bonds an investor can save on taxes as provided under Section 88 of the
Income Tax Act, 1961. The two significant economic factors playing vital role in the investment decisions of
Infrastructure Bonds India are Inflation and interest rate movements. For instance, price of a bond will fall if interest rates rise and vice-versa.
Infrastructure Bonds, India are available through issues of ICICI and IDBI, in the name of
ICICI Safety Bonds and
IDBI Flexibonds. They can reduce tax liability by upto Rs 16,000 per annum. Both the
Infrastructure Bonds, India provide investors the option of purchasing and holding the instruments either as physical certificates or in the demat form. The
Tax-Saving Bond from ICICI for the month of July 2001 provides two options:
- Face value of Rs 5,000 for 3 years at the rate of 9.00% interest payable annually
- Deep Discount Bonds with a face value of Rs 6,600. These bonds are available for Rs 5,000, and are issued for 3 years and 4 months, after which they are redeemed at their face value. These infrastructure bonds are suitable for an increase in the investment. The terms for the IDBI Bonds are similar also.
Apart from the above
Infrastructure Bonds India, Rural Electrification Corporation (REC) has come out with an issue of
tax-saving infrastructure bonds for investors seeking to utilize the additional Rs 30,000 qualifying limit for investments in
Infrastructure Bonds, India.
Infrastructure Bonds, India do not offer any protection against high inflation since the rate of interest they offer is pre-determined. Against
Infrastructure Bonds, India by pledging them with a bank one can borrow from banks. The amount depends on the market value of the bond and the credit quality of the instrument. Moreover, it should be noted that although
Infrastructure Bonds are considered to be safe, there is no assurance of getting the full investment back.
IDBI Bank Greenply Industries
