Mumbai, May 14 -- The Securities and Exchange Board of India (SEBI) has proposed allowing municipal bodies to refinance existing debt through bond issuances, use part of the proceeds for project-linked working capital, and revise the framework for pooled municipal bond fundraising, as part of a review of the municipal debt securities framework. The proposals form part of a consultation paper seeking amendments to the SEBI (Issue and Listing of Municipal Debt Securities) Regulations, 2015.

SEBI has proposed expressly permitting municipal bodies to raise funds through bond issuances to refinance existing loans or debt. Issuers would have to disclose details of the debt being refinanced. These would include the type of existing loan, lender...