With the recent reforms measures expected to yield positive results, the Government has decided not to increase its borrowing target in the current fiscal. With this move, it hopes to be somewhere near the Budget target for fiscal deficit at 5.1 per cent.

The Finance Ministry and the Reserve Bank of India, on Thursday, finalised the borrowing programme for six months beginning October 1.

Addressing the media after the meeting, Economic Affairs Secretary Arvind Mayaram said, “The indicative market borrowing calendar for the remaining period of the year is kept at Rs 2 lakh crore, which is the remaining amount of the market borrowing decided in the Budget estimate 2012-13 for the fiscal deficit.”

He said the Government was committed to bringing about reforms and take the path of fiscal consolidation. Considering these measures, indicative market calendar had been prepared, he added.

In this year’s Budget, the Government had announced a borrowing of Rs 5.7 lakh crore for 2012-13, of which Rs 3.7 lakh crore has already been borrowed during April-September.

“The funding requirements of the Government for second half of the current year have been drawn based on the projected cash flows in its account,” he said.

It has also been decided that short-term borrowing through Treasury bills (91 days, 182 days and 264 days) during October-December will be Rs 1.30 lakh crore. With redemption of T-Bills for the period at Rs 1.49 lakh crore, the net amount will be (-) Rs 19,000 crore.

He said the borrowing was to be completed by February 2013. Market experts feel that, if required, the Government will have headroom for additional borrowing. Going by the trend in tax collection, this additional borrowing could be in the range of Rs 40-50,000 crore.

Meanwhile, sources in the Finance Ministry said weekly borrowing could be in range of Rs 12-13,000 crore, with the last auction on February 15. They hoped that the disinvestment target of Rs 30,000 crore would be met, while the 2G spectrum auction would also yield a substantial amount.

“Improvement in net inflow from small savings will be bonus,” a source said.

He said that the Government’s cash position was ‘fairly comfortable’ at around Rs 53,000 crore. It is not looking at cash management bills till March 2013, he added.

Shishir.Sinha@thehindu.co.in

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