<h1 class="ql-align-center">International Central Securities Depositories (ICSDs)</h1> <h2>Context:</h2> <ul><li>The Reserve Bank of India (RBI) is planning to enable international settlement of transactions in government securities (G-secs) through International Central Securities Depositories (ICSDs), to help expand the investor base for the G-secs market.</li></ul> <h2>About:</h2> <ul><li class="ql-align-justify">An international CSD is a&nbsp;central securities depository&nbsp;that&nbsp;settles trades in international securities&nbsp;such as Eurobonds, although many also settle trades in various domestic securities, usually through&nbsp;direct or indirect (through local agents) links to local CSDs.</li></ul> <ul><li class="ql-align-justify ql-indent-1">Examples of international CSDs include Clear stream (previously Cedel), Euroclear, and SIX SIS.</li></ul> <ul><li class="ql-align-justify">A&nbsp;central securities depository (CSD) that settles domestic and international securities transactions&nbsp;and typically offers additional services such as securities lending and collateral management.</li></ul> <ul><li>Once international settlement of transactions in government securities (G-secs) operationalised, this will enhance access of non-residents to the G-secs market, as will the inclusion of Indian G-secs in global bond indices</li></ul> <h2>Government Securities (G-secs):</h2> <ul><li>A G-Sec is a&nbsp;tradable instrument&nbsp;issued by the Central Government or the State Governments.</li></ul> <ul><li>Government securities come with a promise of the full repayment of invested principal at maturity of the security. </li></ul> <ul><li>Some government securities may also pay periodic coupon or interest payments. </li></ul> <ul><li>These&nbsp;securities&nbsp;are considered conservative investments with low risk since they have the backing of the government that issued them.</li></ul>