Govt to borrow 64% of its borrowing target in just the first half of next fiscal

From April to September 2018, the government will borrow about Rs 3.72 lakh crore from markets, consuming 64% of its borrowing target for the fiscal.

This amount is a little higher compared to the usual 60-62% that is borrowed in the first six months, and the reason could be the finance ministry and Reserve Bank of India’s forecast that ministries will start spending their budget from the beginning of the fiscal itself. Redemption pressure could also be seen as a reason behind this rise in the amount of loans taken.

"Normally every year we borrow 60-62 per cent in the first half of the year, this year it is marginally higher 64 per cent," said Economic Affairs Secretary Shaktikanta Das.

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"90 per cent of the total redemptions (due next year) will happen in the first half. Budget has been passed and money will be available fully from the beginning of the year and considering the revenue inflows and other receipts, the group has decided that of total gross borrowing, 64 per cent is Rs 3.72 lakh crore," Das added.

The budget had fixed gross borrowing at Rs 5.8 lakh crore and net borrowing at Rs 4.25 lakh crore for FY 2018-19.

(Image source: Quartz)