List Of Tax-free Bonds Available In India 2025

Tax-loose bonds in India are debt gadgets issued thru using government-backed entities. These bonds normally have extended tenures, ranging from 10 to 20 years, and are considered low-danger due to the backing of public vicinity undertakings (PSUs). While new issuances were limited in cutting-edge-day-day years, numerous tax-unfastened bonds are notwithstanding the reality that available inside the secondary marketplace as of 2025.

List of Tax-Free Bonds Available in India (2025)

Below is a listing of exquisite tax-unfastened bonds presently to be had in the Indian market:

1. National Highways Authority of India (NHAI)

• Coupon Rate: 7.35% – eight.Seventy 5%
• Maturity: 10 to twenty years
• Credit Rating: AAA
• Purpose: Infrastructure improvement and maintenance of countrywide highways

2. Power Finance Corporation (PFC)

• Coupon Rate: 7.19% – eight.Ninety %
• Maturity: 10 to 20 years
• Credit Rating: AAA
• Purpose: Financing electricity location duties

3. Rural Electrification Corporation (REC)

• Coupon Rate: 7.34% – 8.Seventy one%
• Maturity: 10 to twenty years
• Credit Rating: AAA
• Purpose: Financing rural electrification obligations

4. Indian Railway Finance Corporation (IRFC)

• Coupon Rate: 7.28% – 8.Sixty five%
• Maturity: 10 to 20 years
• Credit Rating: AAA
• Purpose: Financing railway infrastructure

5. Housing and Urban Development Corporation (HUDCO)

• Coupon Rate: 7.27% – 8.76%
• Maturity: 10 to twenty years
• Credit Rating: AAA
• Purpose: Financing housing and concrete infrastructure duties
• Dezerv
• Income Tax India

6. National Thermal Power Corporation (NTPC)

• Coupon Rate: 7.36% – eight.Ninety one%
• Maturity: 10 to 20 years
• Credit Rating: AAA
• Purpose: Financing electricity era tasks
• Income Tax India

7. Indian Renewable Energy Development Agency (IREDA)

• Coupon Rate: 7.Forty three% – eight.50%
• Maturity: 10 to 20 years
• Credit Rating: AAA
• Purpose: Financing renewable strength obligations

8. National Housing Bank (NHB)

• Coupon Rate: 7.22% – nine.01%
• Maturity: 10 to twenty years
• Credit Rating: AAA
• Purpose: Refinancing housing loans and promoting housing finance institutions

9. National Bank for Agriculture and Rural Development (NABARD)

• Coupon Rate: 7.29% – 8.Eighty%
• Maturity: 10 to 20 years
• Credit Rating: AAA
• Purpose: Financing agriculture and rural improvement duties

10. Indian Infrastructure Finance Company Limited (IIFCL)

• Coupon Rate: 7.30% – eight.70%
• Maturity: 10 to twenty years
• Credit Rating: AAA
• Purpose: Financing infrastructure obligations

Key Features of Tax-Free Bonds

• Tax Benefits: Interest income is exempt from profits tax underneath Section 10(15)(iv)(h) of the Income Tax Act.
• Credit Safety: Most tax-free bonds are rated AAA, indicating immoderate creditworthiness.
• Liquidity: These bonds are listed on inventory exchanges, allowing clients to shop for or promote them within the secondary market.
• Tenure: Typically extended-term investments with maturities beginning from 10 to 20 years.
• Interest Payment: Generally, interest is paid each three hundred and sixty five days.

How to Invest in Tax-Free Bonds?

• Secondary Market: Since new issuances have been restricted, customers can buy tax-free bonds via the secondary marketplace via stock exchanges like NSE and BSE.
• Online Platforms: Several on-line systems facilitate the acquisition of tax-free bonds, which includes:

Considerations Before Investing

• Interest Rate Risk: Bond prices are inversely related to hobby costs. If hobby costs upward push, bond prices may also additionally furthermore furthermore fall, affecting the resale charge in the secondary marketplace.
• Liquidity Risk: While the ones bonds are indexed, looking for and selling volumes may be low, doubtlessly impacting the convenience of purchasing or selling.
• Long-Term Commitment: Given their prolonged tenures, clients ought to be organized to hold those bonds till maturity to sincerely enjoy the tax-unfastened interest.

Who Should Invest?

• High-Income Individuals: Investors in better tax brackets can benefit appreciably from the tax-exempt hobby earnings.
• Retirees: Those looking for robust, tax-unfastened income over the long time.
• Conservative Investors: Individuals seeking out low-risk investment options with predictable returns.

Conclusion

Tax-free bonds stay a compelling investment desire in 2025 for those looking for strong, tax-exempt income with minimal risk. While new issuances had been confined, the secondary market offers proper sufficient opportunities to invest within the ones gadgets. Investors want to determine their economic dreams, tax brackets, and investment horizons to determine the suitability of tax-unfastened bonds of their portfolios.a