The government today said it has decided to make additional borrowing of Rs 50,000 crore this fiscal through dated securities, a move that may put burden on the fiscal deficit target of 3.2 per cent of GDP. However, there will be no change in the net borrowing as envisaged in the Budget for 2017-18, a Finance Ministry statement said. After the review of the borrowing programme with the RBI, it was decided that “the government will raise additional market borrowings of Rs 50,000 crore only in fiscal FY’18 through dated Government securities.” Besides, it will trim down the T-Bills from present collections of Rs 86,203 crore to Rs 25,006 crore by March 2018. T-Bills are securities with short-term duration of less than one year while dated securities have maturity of over five years. “The government will thus, between now and March 2018, not be raising any net additional borrowing (T-Bills will be run down by Rs 61,203 crore and additional G-Sec borrowing will be Rs 50,000 crore),” it said. In the Budget for 2017-18, gross and net market borrowing were pegged at Rs 5.80 lakh crore and Rs 4.23 lakh crore respectively with Rs 3.48 lakh crore being raised (net) from dated Government securities and Rs 2,002 crore from T-bills, a Finance Ministry statement said.
Noting that borrowings till December 26, 2017 have been conducted in line with the borrowing calendar fixed for the fiscal, it said, gross and net market borrowings are Rs 5,21,000 crore and Rs 3,81,281 crore, excluding buyback/switches, respectively as on December. As against the budgeted net T-bills receipt of Rs 2,002 crore, net collections till December 26 2017 are Rs 86,203 crore, it said. The government had pegged the fiscal deficit target of Rs 3.2 per cent of the GDP for the current fiscal. Additional borrowing by the government may have impact on the fiscal math.
Since the revenue collection from the Goods and Services Tax (GST) is slightly lower than the expected in the last two months, the additional borrowing would help bridge the shortfall. The GST collections slipped to their lowest in November as rates were cut on dozens of goods to make the new national sales tax regime more acceptable. Total collections under the GST, which is the amalgamation of the excise duty, service tax, VAT and several other indirect taxes, in November slipped for the second straight month to Rs 80,808 crore, down from over Rs 83,000 crore in the previous month.
The revenue collections in October were Rs 83,346 crore, down about Rs 12,000 crore from the September figure of Rs 95,131 crore. The statement further said, revised G-sec and T-Bill calendar for the fourth quarter of 2017-18 are being notified. The revised G-Sec borrowing would be Rs 15,000 crore each last five weekly auctions of this fiscal ending on February 9, 2018. The revised T-Bill borrowing will be Rs 14,000 crore each in first 13 weeks of 2018 ending on March 28.