Mumbai: International Finance Corporation (IFC) has doubled its already launched 1,000-crore three- year global rupee bond programme to promote capital markets and encourage foreign investment in India.

The issue doubles the amount of the first IFC global rupee bond, launched in November last year under the $1 billion global rupee bond programme, the World Bank Group arm said in a release.

The bond offering now stands at 2,000 crore. The transaction was upsized from initial 300 crore in response to strong investor demand. Investors included asset managers, private banks, insurance companies and central banks in Asia, Europe and the U.S., it said.

"The strong market reception for the second IFC global rupee bond signals continued investor interest to rupee exposure," said Monish Mahurkar, IFC Director for Treasury Client Solutions.

"Attracting foreign investment is key as we continue to work with the Indian authorities on deepening the rupee capital markets and providing an alternative source of rupee financing for investment in the country," he added.

Though rupee-denominated, these IFC bonds are settled in dollars, with all principal and coupon payments tied to the U.S. unit-rupee exchange rate.

IFC converts bond proceeds from dollars into rupees on the Indian spot exchange, and uses the rupees to invest in the country.

In recent years, IFC has issued bonds in 14 currencies, including the Brazilian real, the Chinese yuan, the Nigerian naira, and the Russian ruble. India is the largest beneficiary of IFC investment, accounting for $ 4.5 billion as of June 2013, the release said.

In FY13, the international financial agency invested $ 1.38 billion in Asia's third largest economy to achieve several strategic priorities like promoting inclusive growth in low- income states, addressing climate change and supporting global economic integration.

JP Morgan and TD Securities were the lead managers for the transaction.