Govt sets first-half FY19 borrowing target at Rs2,88,000 cr

The government plans to borrow Rs2,88,000 crore ($44.40 billion) in the first half of the 2018-19 financial year that begins in April, the finance ministry stated today.

This will be about 47.5 per cent of the gross targeted market borrowing for the 2018-19 financial year.
The union budget unveiled in February had set the government’s gross market borrowing for the coming fiscal  at Rs6,06,000 crore and net market borrowing at Rs4,62,000 crore.
The Government of India, in consultation with Reserve Bank of India, finalised its borrowing calendar for the first half of 2018-19. The government intends to use larger inflows from Small Savings Schemes to fund its fiscal deficit during the year. The government will borrow Rs1,00,000 crore from NSSF as against budgeted amount of Rs75,000 crore.
After making careful assessment of its financial needs for the first half, the government’s gross G-Sec borrowing will be only Rs2,88,000 crore in H1 of 2018-19. This makes up only 47.5 per cent as against 60-65 per cent share in this period in previous years, a finance ministry release stated.
The government also plans to issue more Floating Rate Bonds (FRBs) and introduce CPI-linked bonds, both put together, to the extent of 10 per cent of issuances during the year.
The finance ministry has issued details of the government’s borrowing programme, including T-bills, as part of detailed press releases on the ministry’s and RBI’s websites. The government will also be coming out with a separate switching calendar to allow investors to sell back their illiquid securities to the government, and also a calendar for Sovereign Gold Bonds issuance.
It may be noted that the government and the RBI are in the final stage of discussions for increasing FPI limits from 1 April 2018.