Govt to borrow 2 trillion rupees, in line with estimates

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New Delhi – India will borrow 2 trillion rupees through bonds in the second half of the current fiscal year, in line with the budget estimate earlier this year, the government said on Thursday.

Arvind Mayaram, economic affairs secretary, said the government would also borrow 1.3 trillion rupees selling short-term treasury bills in the three months to end-December.

In March, the government had pencilled in gross market borrowing of 5.7 trillion rupees through bonds for the 2012/13 fiscal year to help bridge its fiscal deficit that is forecast to be 5.1 percent of the GDP.

But a slowing economy and high spending on subsidies and welfare programmes have meant that achieving the deficit target would be tough.

Analysts polled by Reuters said earlier this week they expected the government to increase its borrowing by 500 billion rupees for the year, and miss the fiscal deficit target by 0.7 percentage points.

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