Govt to borrow Rs 3.72 lakh crore in April-September period

The government will borrow Rs 3.72 lakh crore or 64 percent or total annual gross borrowing during April-September in FY18. The government has released its borrowing calendar for the upcoming financial year with the gross borrowing target fixed at Rs 5.80 lakh crore. The net borrowing target is at Rs 4.20 lakh crore.

Net borrowing for April-September will be around Rs 2.3 lakh crore. Each year, the government borrows from the market to reach its yearly expenditure and interest payment obligations.

The gross borrowing is kept higher in first half due to higher redemptions and also due to early Budget this year, which will mean requirement of funds from April itself for the government.

Total redemptions in the next year is about Rs 1.57 lakh crore, Economic Affairs Secretary Shaktikanta Das told reporters here. "Out of Rs 1.57 lakh crore, nearly 90 percent of the redemption is to happen in the first half of 2017-18," Das said.

Compared to last year, the government will be borrowing less if one removes redemption from the borrowing figure. If redemption of Rs 1.57 lakh crore is removed, the net borrowing will be around Rs 2.2 lakh crore as compared to last year’s Rs 2.48 lakh crore.

Das further said that there will be total 24 auctions and most of these auctions will have a size of about Rs 15,000 crore. "About 4 auctions (out of these) which will have a size of Rs 18,000 crore each. There will be one in April, two in July and one in end of August taking into account the redemption pressure that we have," he said.

Das also said that the focus is doing the borrowing (of government borrowing) is to elongate maturity profile, and also to undertake it in a non-disruptive manner.

The government has set the limit for ways and means advances (WMA) at Rs 60,000 crore which is the limit set for a temporary loan facility that the Reserve Bank of India offers the government.

The WMA limit for first half of current fiscal year was Rs 50,000 crore, Das said.