₹9,000 crore to be raised through market borrowings

With dwindling resources on the financial front, the State government has apparently decided to mobilise funds in the form of auction of securities and market borrowings in the coming days to tide over the crisis.

Accordingly, the State government has decided to mobilise around ₹9,000 crore in the first quarter of the current financial year. The Reserve Bank of India has announced the indicative calender of market borrowings by State governments and also released the weekly schedule of auctions to be held during the period along with the name of States who have confirmed participation along with the tentative amounts indicated by them.

According to the indicative calender, the State government has decided to opt for market borrowings of ₹9,000 crore in six instalments.

Instalments

The first instalment of ₹2,000 crore would be raised on April 13 followed by ₹1,000 crore on April 28, ₹2,000 crore on May 12, ₹1,000 crore on May 26, ₹2,000 crore on June 9 and ₹1,000 crore on June 30.

The development assumes significance in the light of Chief Minister K. Chandrasekhar Rao’s assertion at a press conference the other day that the State government would convince the Central government and the RBI for availing overdraft if need be to bridge the gap in the resources.

The government had raised ₹2,573 crore through sale of securities during the auction conducted by the RBI on March 30.

Of the total amount, ₹1,000 crore was with a tenure of five years with cut off price/yield of 6.88%, ₹750 crore with tenure of eight years and cut off price/yield of 7.25% cent and the remaining ₹823.97 crore with tenure of 10 years and cut off price/yield of 7.35%.