India's slow but steady moves towards an effective securitization market, in particular the development of mortgage-backed securitization, was confirmed recently by two significant regulatory changes.

First, the state budget in March set out changes to the cumbersome foreclosure laws, which have been one of the major factors impeding MBS issuance. Currently, according to Ananda Bhoumik, of Duff & Phelps Credit Rating Co. in Mumbai, taking possession of a property from a defaulted borrower can take up to ten years. Obviously, this makes it difficult for securitizations to gain any benefit from the underlying value of a property, making residential MBS tricky.

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