Government to borrow INR 6.61 lakh crore in second half of current fiscal

NEW DELHI — The government on Thursday said it plans to borrow INR 6.61 lakh crore in the second half of the current fiscal through the issuance of dated securities, including INR 20,000 crore of Sovereign Green Bonds (SGrBs). 

The government, in consultation with the Reserve Bank of India (RBI), has finalised its borrowing programme for the second half (H2) of FY 2024-25.

Out of the gross market borrowing of INR 14.01 lakh crore budgeted for FY 2024-25, INR 6.61 lakh crore (47.2 per cent) is planned to be borrowed in H2, sticking to the gross market borrowing plans.

As per the Ministry of Finance, the gross market borrowing would be completed through 21 weekly auctions.

“The market borrowing will be spread over 3, 5, 7, 10, 15, 30, 40 and 50-year securities. The share of borrowing (including SGrBs) under different maturities will be 3-year (5.3 per cent), 5-year (10.6 per cent), 7-year (7.6 per cent), 10-year (24.8 per cent), 15-year (13.2 per cent), 30-year (12.1 per cent), 40-year (15.9 per cent), and 50-year (10.6 per cent),” the ministry said.

The borrowing programme for the government is managed by the Department of Expenditure, which is part of the Ministry of Finance.

The government said it will carry out switching/buyback of securities to smoothen the redemption profile. It will continue to reserve the right to exercise the greenshoe option to retain an additional subscription of up to INR 2,000 crore against each of the securities indicated in the auction notifications.

In the third quarter of FY25, weekly borrowing through issuance of Treasury Bills is expected to be INR 19,000 crore for 13 weeks with issuance of INR 7,000 crore under 91 DTBs, INR 6,000 crore under 182 DTBs, and INR 6,000 crore under 364 DTBs, respectively. In order to fix temporary mismatches in government accounts, the central bank has fixed the Ways and Means Advances (WMA) limit for the second half of FY 2024-25 at INR 50,000 crore.