New Delhi: The Centre plans to borrow Rs 6.77 lakh crore in the second half of the fiscal year 2025-26 (H2: FY 2025-26) through dated securities, including Rs 10,000 crore through issuance of Sovereign Green Bonds (SGrBs), according to a Finance Ministry statement issued on Friday.
The gross market borrowing of Rs 6.77 lakh crore will be completed through 22 weekly auctions till March 6, 2026. 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 (6.6 per cent), 5-year (13.3 per cent), 7-year (8.1 per cent), 10-year (28.4 per cent), 15-year (14.2 per cent), 30-year (9.2 per cent), 40-year (11.1 per cent) and 50-year (9.2 p er cent), the statement said.
The government will continue to carry out the switching/buyback of securities to smoothen the redemption profile. It will also continue to reserve the right to exercise the greenshoe option to retain an additional subscription of up to Rs 2,000 crore against each of the securities indicated in the auction notifications.
Weekly borrowing through issuance of Treasury Bills in the third quarter (Q3) of FY 2025-26 is expected to be Rs 19,000 crore for 13 weeks, with issuance of Rs 7,000 crore under 91 DTBs (dated treasury bills), Rs 6,000 crore under 182 DTBs, and Rs 6,000 crore under 364 DTBs, respectively.
To take care of temporary mismatches in government payments and receipts, the Reserve Bank of India (RBI) has fixed the Ways and Means Advances (WMA) limit for H2 of FY 2025-26 at Rs 50,000 crore, the statement added.
Dated government securities, or G-secs, are long-term bonds issued by a government to finance its debt and meet expenditure commitments. They have a fixed maturity date, a fixed coupon (interest rate) paid semi-annually on the face value, and are redeemed at par value upon maturity. Examples include the 7.17 per cent GS 2028, a Government of India security that pays a 7.17 per cent coupon semi-annually and matures in January 2028
The government has finalised its borrowing programme for the second half (H2) of FY 2025-26 in consultation with the RBI. The Centre plans its market borrowings in a phased manner so that liquidity is not squeezed out for investments in the corporate sector, which tends to hurt economic growth. Excessive borrowing can also lead to inflation and increase the fiscal deficit.
(IANS)
