2500 crore a day

March 24, 2015 16:59
2500 crore a day

Union government will borrow Rs 3.6 lakh crore from the markets in the first half of the next financial year, which is over 50% of the annual target of Rs 6 lakh crore. "We will issue long-term bonds of 40 years in early next financial year. It will help us in the long run and will provide stability in the system," Finance Secretary Rajiv Mehrishi told. The total borrowing in the first six months would be to the tune of Rs 3.6 lakh crore, he added. He said the central government would be borrowing about Rs 17,000-18,000 crore through bonds every week. The net borrowing in the first half of the current fiscal would, however, be Rs 2.25 lakh crore, Mehrishi said, adding "government will issue concept paper on switching (of government bonds) in 15 days."

Government borrows money from the markets through T-bills and other instruments to fund its fiscal deficit.

The government plans to borrow Rs 6 lakh crore from the market in the next fiscal, up from Rs 5.92 lakh crore in 2014-15. However, the net borrowings in 2015-16 will be Rs 4.56 lakh crore, after considering repayments of past loans and interest. The budgeted target for borrowing in current fiscal was also Rs 6 lakh crore, but it is likely to remain at around Rs 5.92 lakh crore. In the financial year ending March, the fiscal deficit has been estimated at 4.1%. In 2015-16, the deficit will be pruned to 3.9%.

By Premji

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