The Canadian province of British Columbia is set to become the first foreign government to issue yuan-denominated bonds in China's onshore market.

Michael de Jong, the province's Finance Minister, said on Thursday that the province has gained regulatory approval from the People's Bank of China, the Chinese central bank, to raise 6 billion yuan ($938 million) on the Chinese inter-bank market.

The issuance underscored the Canadian province's desire to gain access to the deep pool of liquidity in the world's second largest bond market and its confidence for the rising profile of the Chinese currency in the international markets, De Jong said in Beijing.

The minister said an attractive option with the proceeds from the bond issuance would be investing funds in onshore yuan-denominated products, given the growing trade settlement in the Chinese currency between Canada and China.

The Canadian official said he anticipated a positive pricing from investors after meeting with Chinese government officials and financial institutions, adding that the sale of the bond will take place early next year.

Analysts have said that the yuan's inclusion in the Special Drawing Rights currency basket of the International Monetary Fund could spark a growing interest among foreign issuers and investors in China's onshore bond market.

South Korea has reportedly planned to issue sovereign yuan-denominated bonds in China's onshore market. Indonesia and Russia may follow in 2016 and Standard Chartered Bank Hong Kong Ltd, Export-Import Bank of Korea and Russia's Vnesheconombank are among the corporate insurers, according to Bloomberg.

China's panda bond market is likely to expand further on investors' anticipation of continued monetary easing by the Chinese central bank, which will allow onshore borrowing costs to remain lower than that in the offshore market, analysts said.