New Delhi, July 1 -- Foreign investors pumped a record nearly Rs.25,800 crore (about $3 billion) into Indian government bonds in June, marking the highest monthly inflow on record, according to reports.

The surge was driven by the government's decision to remove taxes on foreign bond investments and renewed optimism over India's potential inclusion in a major global bond index.

Data from the clearing house showed that overseas investors purchased a net Rs.25,800 crore worth of government securities under the Fully Accessible Route (FAR) during June, sharply higher than the combined Rs.14,600 crore (around $1.7 billion) invested between January and May.

The buying momentum accelerated after the government exempted foreign investors from...