"In a month's time, we will announce guidelines for the gold-deposit scheme," he said on the sidelines of a seminar on debt market organised by ICICI Securities in Mumbai.

Referring to Reserve Bank of India's insistence that the Centre must keep its borrowing programme in tight leash, Kelkar said unlike fiscal 1999, in the current year, the shortfall in the fiscal deficit will not be met by the Government's borrowing programme. "The Government borrowing will not exceed last year's... The Government has taken heed of warnings over its high fiscal deficit issued by RBI in its April monetary policy," he said.

In fiscal 1998-99, the Centre exceeded its borrowing target by Rs 14,376.82 crore to Rs 93,752.82 crore against its gross borrowingtarget of Rs 79,376 crore. For the current fiscal, it has raised its budgeted net borrowing programme by 19 per cent at Rs 57,461, up from Rs 48,326 crore last year. Of the Rs 83,571-crore gross-borrowing target, it has already raised Rs 24,500 crore (31 per cent) in the first six weeks of the year.

The RBI had earlier warned the ministry that high government borrowings put pressure on the financial system and that interest payments were eating into fresh borrowings. It said the system of borrowing higher amounts means fund increasing repayments can not go on forever.

"Continuing fiscal deficits year after year in the 1990s have led to sharp increases in repayment obligations and a reduction in average maturity profile of outstanding public debt," it said.

RBI chief general manager (internal debt) Usha Thorat, who spoke at at the seminar, said the central bank will resort to private placement and auction to complete its borrowing programme. She said the RBI will shortly address issues relating to shortselling of securities, standardisation of repo and best practice for the market.

Finance secretary Kelkar is bullish on the disinvestment front and is of the view that the Centre will be able to raise Rs 10,000 crore through divesting its stake in public sector undertakings. "I do not think that the target we have set for the current fiscal is high," he said.

On insurance sector reforms, the finance secretary said the Government does not propose to issue an ordinance on Insurance Regulatory Authority (IRA). He said the legislation proposing to allow foreign players into India's protected domestic insurance sector is held up as the country is being run by a caretaker Government with limited powers till the forthcoming elections.