The Centre's gross borrowing crossed the Rs 1,62,000 crore (Rs 1,620 billion) mark as bond market turned bullish after a fall in price level in the country last week.
The gross borrowing of Rs 1,62,069 crore (Rs 1,620.69 billion) till last week was 7.2 per cent higher than Rs 1,51,126 crore (Rs 1,511.26 billion) mopped up during the same period last fiscal, according to PNB Gilts.
The government has so far issued dated securities worth Rs 1,35,934 crore (Rs 1,359.34 billion) and treasury bills worth Rs 26,135 crore (Rs 261.35 billion).
The borrowing would have been lower if one excluded Rs 14,434 crore (Rs 144.34 billion) worth of high-cost securities that was bought back by the Centre from banks and financial institutions to reduce the interest burden.
The Centre also redeemed securities worth Rs 58,244 crore (Rs 582.44 billion) so far this fiscal, which was much higher than Rs 42,848 crore (Rs 428.48 billion) during the same period last fiscal, PNB Gilts said.
After negating the redemptions from the gross borrowing, the Centre's net borrowing was lower by 4 per cent at Rs 1,03,825 crore (Rs 1,038.25 billion) till March 19, 2004.
PNB Gilts said the market turned bullish with securities prices moving up and the yield on benchmark 10-year paper fell to 5.18 per cent after the unexpectedly low inflation rate of 5.32 per cent and finance ministry's decision to defer issue of market stabilisation bonds in the next fiscal.
The market stabilisation bonds are being considered to sterilise the high forex reserves now at over $109 billion, which otherwise have the potential to push up inflation in the country.
The Indian bond market was also bullish after steep fall in returns from US treasury securities following the "below expected" job data released in that country, it said.
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