Government today asked the Reserve Bank to issue bonds amounting Rs 10,000 crore (Rs 100 billion) to suck excess liquidity from the market. The auctions will be conducted by the Reserve Bank on January 11, said a Finance Ministry statement.
The Rs 6,000 crore (Rs 60 billion) bonds will carry a coupon rate of 7.99% and will mature in 2017, while Rs 4,000 crore (Rs 40 billion) bonds will carry a coupon rate of 8.33% and will mature in 2036, said the statement.
Notably, government has revised the limit to Rs 2,50,000 crore (Rs 2, 500 billion) for issuing bonds under the market stabilisation scheme for 2007-08. The Central Bank last sold treasury bills to mop up surplus money on December 5, but has refrained from selling the short-term securities under the Market Stabilisation Scheme for four weeks. It last offered longer-maturity bonds under the plan on November 1.