The Centre is likely to announce its revised borrowing programme till October 2009 on Thursday, although it will continue raising between Rs 12,000 crore and Rs 15,000 crore from the market every week. ?The run rate (of the Rs 15,000 crore borrowing) is unlikely to come down,? finance secretary Ashok Chawla said on Wednesday at a post Budget conference of CII.
The Debt and Cash Management Group, comprising of senior officials of the RBI and finance ministry, will meet on Thursday, a day earlier than planned, to finalise the Centre?s borrowing calendar.
The Centre?s gross borrowing for 2009-10 is estimated Rs 4.51 lakh crore. Chawla stressed that the government borrowing programme will not crowd out private sector needs. ?Till September 2009, the Centre is expected to borrow about Rs 2,41,000 crore of which it has already raised Rs 1,65,000 crore. Now about Rs 80,000 crore is left. I don?t think it will upset anything as there?s enough liquidity,? he said. But to ensure that private sector requirements are met, the finance secretary said, the government will try to raise most of its borrowing needs in the first half of 2009-10 in order to leave more room for private borrowers in the second half of the fiscal year.
?We are conscious of the fact as economy revives, which we hope it will in the next three months or so, there will be demand for more borrowing by other players,? he said.
Further, the government will not just rely only on market borrowings, although it would also not go in for monetisation of its debt. ?The market certainly has appetite today because there is lot of liquidity. Therefore, we are trying to borrow more directly at this stage. The RBI (Reserve Bank of India) will at a later stage support more through the open market operation,? Chawla said.
?We will support our borrowing needs with treasury bills and unwinding of securities where money had come in from foreign sources,? he said. He also reiterated, ?There is no proposal of monetising debt, as it is not permissible under the Fiscal Responsibility and Budget Management Act.?