The government will raise Rs 96,000 crore (Rs 960 billion) from the market in April-September 2008 by issuing securities to part-finance its expenditure in 2008-09, the Reserve Bank of India said on Monday.
Of this, the government plans to mop up Rs 20,000 crore (Rs 200 billion) in April, RBI said. The centre will sell securities worth Rs 6,000 crore (Rs 60 billion) of 5-9-year gilts and Rs 4,000 crore (Rs 40 billion) of 20-year and above gilts between April 4 and 11.
It would raise Rs 6,000 crore through sale of 10-14-year government paper and Rs 4,000 crore (Rs 40 billion) via sale of 20-year and above gilts between April 18 and 25.
"This programme does not seem to be different from the trend seen in the past. When the redemptions of the past debt are high in the first half, the borrowings will also likely to be higher," said the treasury head of a public sector bank.
A dealer of a bond house said: "The government borrowings number does not deviate much from expectations. Some people were expecting it to be Rs 100,000 crore (Rs 1,000 billion). So it's slightly positive."
The expectations are that the interest rate will remain benign in the first half of the next financial year compared with remaining period in 2008-09 and the government will like to take advantage of the lower-rate environment as it means less outgo on interest payments.
The government is scheduled to borrow Rs 1,45,100 crore (Rs 1,451 billion) through dated securities in 2008-09, compared with 156,000 crore (Rs 1,560 billion) in the current financial year (2007-08).
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