($1 = 82.4350 Indian rupees) (Reporting by Nikunj Ohri and Dharamraj Dhutia; Editing by Savio D'Souza)
Messaging: twitter.com/nikunj_ohri)) By Nikunj Ohri and Dharamraj Dhutia
March 15 (Reuters) - The Indian government's borrowing
for April-September is likely to be between 55% and 58% of its
gross borrowing target for next fiscal year, two government
officials said on Wednesday, to front-load expenditure and keep
bond supply closer to market expectations.
India aims to raise 15.43 trillion rupees ($187.18 billion)
from the market in the financial year starting April 1, higher
than the 14.21 trillion rupees it raised this year.
"The government is planning to keep its borrowing (at)
55%-58% in the first half of the year. A final decision would be
taken after consulting with the Reserve Bank of India (RBI) on
March 27," said one of the officials.
The officials did not want to be named as they are not
authorised to speak to the media. A finance ministry
spokesperson did not immediately reply to a Reuters email
seeking comment.
The government borrowed 58% of its full-year target in the
first half of this financial year.
However, market participants want that to be reduced to 55%
of this year's target, with a higher share of longer-tenor
paper, given the sizeable maturities due in October-March.
Bonds worth 1.59 trillion rupees are due to mature in the
first half of next financial year and 2.81 trillion rupees in
the second.
The government also plans to conduct Treasury bill issuances
in an orderly manner next fiscal year, another official said.
This comes after the government unexpectedly raised its
borrowing by 500 billion rupees via these ultra-short-term
instruments this month.
The higher supply, along with a drop in the banking system
liquidity, saw the 364-day yield rise above the 10-year bond
yield last week, prompting the government to consider remedial
measures, Reuters reported.
The officials also said the government was not keen to
launch a new 20- or 50-year bond, as some market participants
expect, as the former would dent demand in the 14-year segment
and there are few takers, apart from some insurers, for the
latter.
The government and the RBI will also discuss issuing green
bonds, although the timing may not be appropriate given foreign
investors have turned jittery after the failure of Silicon
Valley Bank, the first official said.
The government raised 160 billion rupees this year through
green bonds but announced no plans for such issuances for this
year in the 2023/24 budget.
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