Showing Commitment
Govt committed to path of fiscal prudence despite pressures, says Fin min source
This story was originally published at 20:56 IST on 25 September 2026
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NEW DELHI – The government is committed to the path of fiscal prudence laid out in the Budget for 2026-27 (Apr-Mar) despite the incipient fiscal pressures, a finance ministry official said, highlighting that the government's net market borrowing for FY27 has been maintained at the Budget levels.
In a release on Friday, the finance ministry said that the government aims to raise INR 7.86 trillion through the sale of dated securities in Oct-Mar, bringing down its gross market borrowing target in FY27 to INR 16.00 trillion from INR 16.09 trillion announced in March, and substantially below the FY27 Budget estimate of INR 17.20 trillion. On a net basis, the government will issue INR 6.26 trillion of gilts in Oct-Mar, higher than INR 5.38 trillion issued in the first half. This will bring the full year net market borrowing to INR 11.64 trillion, slightly lower than INR 11.73 trillion projected in the Budget.
The official said that focus on long-term bonds will help the government increase its weighted average maturity, which had fallen during Apr-Sept. "A longer WAM (weighted average maturity) will help reduce the roll-over risk," the official said.
In Apr-Sept, the share of bonds maturing in over 30 years had shrunk to less than 25% from 29.4% and 35.0% in the borrowing calendar for the second half and first half of FY26, respectively. However, long-term bonds saw their issuance rise in the Oct-Mar borrowing plan. The 30-year bond will now make up 9.2% of the calendar, against 7.3?rlier. The rise in the share of the 40- and 50-year bond is marginal, rising to 8.9% and 9.9%, respectively.
"Government is managing its debt in the most prudent manner by resorting to switches/buybacks etc, and is aiding the market by not adding any additional pressure," the official said. End
Reported by Pratiksha
Edited by Avishek Dutta
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