New Delhi: The finance minister, P Chidambaram, yesterday said that the centre would go ahead with its market borrowings programme for the current fiscal, even as the cost of government borrowings is showing a rising trend.

"We have to borrow what we have planned to borrow. We will complete the borrowings programme and borrow at whatever rate the market decides," Chidambaram told reporters.He, however, ruled out the possibility of government borrowings ''crowding-out'' borrowings by corporates, leading to an overall increase in interest rates.

As on October 21, the centre has completed gross market borrowings of Rs75,044 crore, corresponding to 49.8 per cent of the budgeted amount for 2004-05.

In his mid-term review statement, the Reserve Bank of India (RBI) governor, Y V Reddy, had noted that the "larger than usual" borrowing slated for the second half of the year would mean that government borrowings in the coming months need to be "calibrated carefully".

He had further warned that the "lower appetite" for gilts in the current scenario of increased non-food credit off-take would have "implications for government borrowings in an environment of market-determined interest rates".

Chidambaram said there was still enough liquidity in the system and the issue of crowding-out does not arise. In fact, the move by the RBI to raise its repo rate by 25 basis points was a reflection of this very perception, he added.