Govt pegs net market borrowing at Rs 5.36 lakh crore for FY21
According to the Revised Estimate, the net borrowing for the current financial year was raised to Rs 4.99 lakh crore as against the Budget Estimate of Rs 4.48 lakh crore.
The gross borrowing would be Rs 7.8 lakh crore for the next financial year as compared to Rs 7.1 lakh crore estimated for the current financial year.
Gross borrowing includes repayments of past loans.
Repayment for past loans in the next financial year has been pegged at Rs 2.35 lakh crore.
Presenting Budget for 2020-21, Finance Minister Nirmala Sitharaman said, "Net market borrowings for the year 2019-20 would be Rs 4.99 lakh crore and for the year 2020-21, it would be Rs 5.36 lakh crore."
"A good part of the borrowings for the financial year 2020-21 would go towards capital expenditure of the government that has been scaled up by more than 21 per cent.
"As I had previously mentioned another about Rs 22,000 crore have been allocated for equity to fund certain specified infrastructure finance companies, who would leverage it manifold and provide much-needed long-term finance to the infrastructure sector. That should spur growth impulses in the economy," she said.
The government raises funds from the market to fund its fiscal deficit through dated securities and treasury bills.
The government has pegged fiscal deficit at 3.5 per cent from the next financial year, down from 3.8 per cent of the GDP for the current financial year.
The government had earlier estimated the fiscal deficit to be 3.3 per cent of the GDP for the current fiscal but due to revenue shortage, it had to increase it and utilise the 'escape clause' in the Fiscal Responsibility and Budget Management (FRBM) Act.