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Tuesday, February 10, 2009

Centre to borrow Rs 46000 crore extra between mid-Feb to March end

Increase in govt borrowing has weighed on bond prices

The Centre will reportedly borrow an extra Rs 46000 crore ($9.45 billion) between 20 February 2009 and late March 2009. Meanwhile, RBI Deputy Governor Shyamala Gopinath on Tuesday, 10 February 2009, said the central bank

will carry out the government's extra borrowing programme in a non-disruptive manner.

Government bond prices

have plunged in 2009 as the government borrowed more than budgeted for the fiscal year ending 31 March 2009 to pump prime the economy. Global rating agency Fitch Ratings on Monday, 9 February 2009, affirmed India's ratings on Monday but kept its negative outlook on the local currency rating, saying public finances will deteriorate due to a weakening economy and government stimulus measures

The Central Statistical Organisation (CSO) on Monday pegged India's projected GDP growth for the year ending March 2009 at 7.1%, the slowest in six years and below the previous year's 9%.

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