RBI Decides to Set Meeting with the Govt to Finalise on the First Half Borrowing


RBI Decides to Set Meeting with the Govt to Finalise on the First Half Borrowing

Lockdown hitting the top of the country’s scenario has led to video conferencing between FM NirmalaSitharaman and RBI. The discussion would be on planning to borrow INR 5.36 lakh crore from the market.

RBI & Finance Minister NirmalaSitharaman will set up a meeting tomorrow (31 March 2020) to finalise on the borrowing plan for the first half. The government plans to borrow INR 5.36 lakh crore from the market in 2020-21, more than estimated value (INR 4.99 lakh crore) of the present year.

While presenting Budget for 2020-21, Finance Minister NirmalaSitharaman had 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".

she also added, "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.

However, the Govt would concentrate on utilizing the amount to address the crisis caused by COVID-19 on the country’s economy. Gross borrowing has been pegged marginally higher than the ongoing fiscal and would be 7.8 lakh crore for the next fiscal year comparedto INR 7.1 lakh crore estimated this year. It includes repayments of past loans and interests.

According to sources, the meeting between the Finance Ministry and Reserve Bank of India (RBI) will be held through video conferencing for the first time as there is lockdown across the country.

It also stated that post meeting the borrowing calendar for issuance of dated government securities and short term papers will be announced in the evening.