Parliament has approved a gross borrowing for Rs 7.1 lakh crore for the entire 2019-20 fiscal.
Illustration: Uttam Ghosh/Rediff.com
The central government is looking at raising Rs 4.42 lakh crore through borrowing in the first half of the 2019-20 fiscal, Economic Affairs Secretary Subhash Chandra Garg said on Friday.
Parliament has approved a gross borrowing for Rs 7.1 lakh crore for the entire 2019-20 fiscal.
"We will be raising Rs 4.42 lakh crore (gross) in the first half (of FY 2019-20), or Rs 17,000 per week for 26 weeks," Garg told reporters.
The remaining Rs 2.68 lakh crore or 37.7 per cent of the total gross borrowing would be raised from the markets by floating government bonds and treasury bills during the October-March period.
Net borrowing in the first half (April-September) would be Rs 3.40 lakh crore. In the second half, net borrowing would be lower at Rs 1.33 lakh crore.
“So in the second half, it would be Rs 83,000 crore plus buyback of Rs 50,000 crore. Net borrowing for the full year is Rs 4.23 lakh crore," the secretary said.
The government, in the interim Budget in February, had proposed to restrict the fiscal deficit at 3.4 per cent of the GDP in the next fiscal beginning February 1.
The government borrows from the market to the fiscal gap.
As per the Union Budget, the gross borrowing was pegged at Rs 7.1 lakh crore for 2019-20, higher than Rs 5.71 lakh crore estimated for the ongoing fiscal.
Garg said the gross borrowing is higher because of the repayment programme.
Gross borrowing amount is also used towards repayments of past loans.
Garg also said the government will stick to the fiscal deficit target of 3.4 per cent of the GDP for the current fiscal.
He also said the government would be be introducing a new benchmark of 7 years for dated securities.
"You would recall in the current financial year we had introduced two new benchmarks of two-year security and five-year security.
“Now there will be 7-year security also. So we complete the yield curve," he added.
The Reserve Bank of India releases the schedule of government borrowing.
The central bank also provides funds to the government under Ways and Means Advances (WMA) mechanism to help it tide over short-term mismatch in receipts and payments.
