India’s borrowing market will be about $200 billion in 2023
2023.01.27 08:58
India’s borrowing market will be about $200 billion in 2023
By Kristina Sobol
Budrigannews.com – According to two sources close to the discussions, the federal government of India is likely to keep its gross market borrowing below 16 trillion rupees ($196 billion) for the years 2023 and 2024. This is because the government does not want to upset the bond market with bad news.
One of the officials told:
“Feedback from the market participants is that a borrowing of 15.5-16 trillion rupees can be absorbed well in the next financial year.”
According to the second official, the government’s discussions so far have led to the conclusion that borrowing should be in line with market expectations.
Up until January 27, the government had raised 12.93 trillion rupees, or 91% of the total gross borrowing target for the 2022/23 fiscal year, which ends on March 31.
The government’s fiscal consolidation path and borrowing calendar for fiscal year 2024 are expected to be the next market-moving trigger when the Union budget is presented on February 1.
The federal government’s gross debt has more than doubled over the past four years as Prime Minister Narendra Modi’s administration has spent heavily to alleviate poverty and protect the economy from the COVID-19 pandemic.
An email and a message asking for feedback did not receive an immediate response from the Indian finance ministry.
According to a poll conducted by Reuters, economists anticipate that the government will borrow a record 16 trillion Indian rupees to increase infrastructure spending during the fiscal year ending March 2024.
In addition, the survey suggested that the government would reduce the budget deficit to 6.0 percent of GDP in 2023/24. By 2025/26, it aims to achieve a target of 4.5 percent.
The ratio of federal and state government debt to GDP is 83%, which is higher than many other emerging economies’ debt-to-GDP ratios. The sovereign credit rating of the nation is just slightly higher than the junk level.
In order to guarantee that India’s debt can be sustained over the medium term, the International Monetary Fund stated last month that the country required a more ambitious plan for fiscal consolidation. The government claims that the plan it has in place now is sufficient for the job.
More:
Revived Tata’s Air India makes major order for planes
Luxury sellers are waiting for buyers after lifting of restrictions in China
