The Centre will borrow a majority of its fund requirements for 2015-16 in the first half of the fiscal, raising Rs 3.6 lakh crore from the market between April and September 2015. This amounts to 66.7 per cent of the targetted gross market borrowing of Rs 6 lakh crore in 2015-16. It also plans to raise long term bonds of 40-year duration from the market. “We will issue long-term bonds of 40 years in early next financial year. It will help us in the long run and will provide stability in the system,” said finance secretary Rajiv Mehrishi after meeting with RBI officials on Monday to finalise the Centre’s borrowing programme. [related-post] The move is in line with customary practice where the government front loads its borrowing programme, giving more space to private sector companies to tap the market in the second half of the fiscal. In 2014-15, the finance ministry announced that it would borrow Rs 3.68 lakh crore of its Rs 5.97 lakh crore target in the first half of the fiscal. The government borrows money from the markets through T-bills and other instruments to fund its fiscal deficit. The Centre’s fiscal deficit is estimated at 3.9 per cent of the GDP in 2015-16, as against the targetted 4.1 per cent in 2014-15.
