Markets

Govt. raises borrowings to ₹12 lakh crore in FY21

The government on Friday increased its market borrowing estimate by staggering ₹4.2 lakh crore to ₹12 lakh crore for the current fiscal to deal with the expected shortfall in revenue due to the impact of COVID-19 crisis on the economy.

The government resorts to market borrowing to make up for mismatch between its revenue and expenditure. “The estimated gross market borrowing in FY 2020-21 will be ₹12 lakh crore in the place of ₹7.80 lakh crore as per BE 2020-21. The revision has been necessitated due to COVID-19 pandemic,” the Finance Ministry said. The government has also increased the weekly borrowing target to ₹30,000 crore from ₹21,000 crore fixed on March 31.

Finance Minister Nirmala Sitharaman in her Budget for 2020-21 had pegged gross borrowing in the new fiscal at ₹7.8 lakh crore, higher than ₹7.1 lakh crore estimated for 2019-20. With the increase in estimate, the government would have to revise upwards its fiscal deficit target from 3.5% pegged for the current fiscal.

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Printable version | Dec 5, 2020 3:55:17 PM | https://www.thehindu.com/business/markets/govt-raises-borrowings-to-12-lakh-crore-in-fy21/article31538220.ece

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