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The “loan review has been necessary due to the COVID-19 pandemic,” the government and the Reserve Bank of India said in two separate statements.
Along with the indicated increase in total loans for the year, a loan schedule has also been released for the remainder of the first half of the fiscal year.
According to the revised schedule, the government will borrow Rs 6 lakh crore from the market through gilts for the remainder of the first half of the year. The auction size for each weekly auction will amount to Rs 30,000 crore from the week of May 11.
India has been in a lockdown for eight weeks, causing massive economic losses and causing Moody’s to forecast 0% growth for the country this year.
In March, Economic Affairs Secretary Atanu Chakraborty said the government planned to borrow more aggressively than expected in the April-September period to mitigate the coronavirus outbreak.
“The government will do whatever is necessary for the resurgence and recovery of industries. Our fundraising resources not only from markets but also from multilateral agencies are geared towards that,” said Chakraborty.
The Minister of Finance, Nirmala Sitharaman, in her Budget for 2020-21 had been linked gross
loan in the new financial year at Rs 7.8 lakh crore, higher than the estimated Rs 7.1 lakh crore for 2019-20.
With the increase in
loan According to estimates, the government would have to revise up its 3.5% fiscal deficit target linked to the current fiscal.
With agency tickets
.
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