Govt's net borrowings under control, show steady trend: SBI Report
Data from a report by SBI showed that the government is actively managing its debt through various instruments while adhering to fiscal discipline under the FRBM Act.
It said, "G sec borrowing trend.... Keeping the borrowings in check."
As per the data, gross market borrowing through government securities (G-secs) is estimated at Rs 14.8 lakh crore in the Budget Estimates for FY26, while net borrowing is projected at Rs 11.5 lakh crore.
So far in FY26, the government has raised Rs 3.2 lakh crore as gross borrowing, and Rs 2.4 lakh crore as net borrowing.
In the previous financial year (FY25), gross borrowing stood at Rs 14.0 lakh crore, while net borrowing was Rs 10.7 lakh crore. Similarly, FY24 had seen gross borrowing of Rs 15.4 lakh crore and net borrowing of Rs 10.7 lakh crore.
This shows that while gross borrowing fluctuates with fiscal needs, net borrowing is being kept largely in check.
The report also highlighted that the outstanding stock of government debt through G-secs has steadily risen over the past decade, from Rs 41.6 lakh crore in FY15 to Rs 114.5 lakh crore so far in FY26.
However, this surge has been managed with caution, and the government is making genuine efforts to reduce overall debt levels.
The debt-to-GDP ratio is estimated at 57.1 per cent for 2024-25 and is projected to decline to 56.1 per cent in 2025-26, as per the FRBM guidelines.
To fine-tune its borrowing profile, the report mentioned that the government is also using debt switch and buyback operations.
In FY26, switch borrowings are budgeted at Rs 2.5 lakh crore, and buybacks have already accounted for Rs 0.5 lakh crore. In past years, switch operations ranged from Rs 0.3 to Rs 2.0 lakh crore, depending on the fiscal strategy.
In the context of banking and finance, a debt switch typically refers to a transaction where a borrower exchanges one type of debt security for another, often with the goal of restructuring debt obligations or managing liquidity. While the buyback operations typically refer to the repurchase of government securities or corporate bonds by central bank (RBI).
On this the SBI report noted a dichotomy in current trends. While issuing more short-term papers may support immediate funding needs for a fast-growing economy, it could lead to higher redemption pressure in the medium term.
The report outlined that while India's public debt has grown in absolute terms, the government's prudent fiscal management, stable borrowing trends, and strategic tools like debt switches and buybacks are helping maintain long-term sustainability.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Times of Oman
3 hours ago
- Times of Oman
Will increase tariff on India "very substantially" over next 24 hours for purchase of Russian oil: Donald Trump
Washington DC: Hours after he mentioned raising tariff on India, US President Donald Trump on Tuesday said he would increase the tariff charged on imports from India from the current rate of 25% 'very substantially' over the next 24 hours due to New Delhi's continued purchases of Russian oil, Reuters reported. 'They're fuelling the war machine, and if they're going to do that, then I'm not going to be happy,' Trump told CNBC in an interview, according to Reuters. According to the report, he added that the main sticking point with India was that its tariffs were too high but did not provide a new tariff rate. Trump had said on Monday that the United States will 'substantially raise' the tariff paid by India for buying 'massive amounts of Russian Oil', stating that much of the oil purchased from Moscow is being sold in the open market 'for big profits'. Trump's announcement, made on his social media platform Truth Social, came days after he announced a 25 per cent reciprocal tariff on India and an unspecified penalty for importing oil from Russia. 'India is not only buying massive amounts of Russian Oil, they are then, for much of the Oil purchased, selling it on the Open Market for big profits. They don't care how many people in Ukraine are being killed by the Russian War Machine. Because of this, I will be substantially raising the Tariff paid by India to the USA. Thank you for your attention to this matter!!!' the US President said in the post. Soon, after the US President's remark, India said that 'the targeting of India is unjustified and unreasonable'. A statement by official spokesperson of the Ministry of External Affairs said that the government will take all necessary measures to safeguard its national interests and economic security. The spokesperson said that India has been targeted by the United States and the European Union for importing oil from Russia after the commencement of the Ukraine conflict. 'In fact, India began importing from Russia because traditional supplies were diverted to Europe after the outbreak of the conflict. The United States at that time actively encouraged such imports by India for strengthening global energy markets stability. India's imports are meant to ensure predictable and affordable energy costs to the Indian consumer. They are a necessity compelled by global market situation. However, it is revealing that the very nations criticizing India are themselves indulging in trade with Russia. Unlike our case, such trade is not even a vital national compulsion,' the statement noted. MEA spokesperson said that the European Union in 2024 had a bilateral trade of Euro 67.5 billion in goods with Russia. In addition, it had trade in services estimated at Euro 17.2 billion in 2023. 'This is significantly more than India's total trade with Russia that year or subsequently. European imports of LNG in 2024, in fact, reached a record 16.5mn tonnes, surpassing the last record of 15.21mn tonnes in 2022.' The spokesperson said that Europe-Russia trade includes not just energy, but also fertilizers, mining products, chemicals, iron and steel and machinery and transport equipment. 'Where the United States is concerned, it continues to import from Russia uranium hexafluoride for its nuclear industry, palladium for its EV industry, fertilizers as well as chemicals. In this background, the targeting of India is unjustified and unreasonable. Like any major economy, India will take all necessary measures to safeguard its national interests and economic security,' the statement said. India has, earlier too, defended its sovereign right to conduct energy policy based on national interest. The government had clarified that India's energy purchases are guided by market dynamics and national interests. 'You are aware of our broad approach to energy sourcing requirements, that we look at what is available in the market and the prevailing global situation. We are not aware of any specifics,' MEA Spokesperson Randhir Jaiswal said last week, answering queries on Trump's announcement of a penalty for purchasing Russian oil. Answering another query, Jaiswal said India's relations with any country are based on their own merit and shouldn't be viewed through the lens of third countries. 'Our ties with any country stand on their merit and should not be seen from the prism of a third country. As far as India-Russia relations are concerned, we have a steady and time-tested partnership,' he a query on Friday, Trump indicated that if India stops buying Russian, it will be a good step. Trump announced the imposition of 25 per cent tariffs on Indian goods and a penalty for importing Russian oil in the last week of July, even as there were hopes of an interim India-US trade that would have otherwise helped avoid elevated tariffs. There are apprehensions that global crude prices could jump to $200 a barrel if India were to stop buying Russian oil, which will severely harm consumers.
Times of Oman
7 hours ago
- Times of Oman
India-Philippines sign 14 MoUs increasing maritime, defence, tourism cooperation; take forward Preferential Trade Agreement talks
New Delhi: India and the Philippines signed and exchanged 14 Memoranda of Understanding (MoUs) on Tuesday, looking to increase cooperation across sectors, including sharing the terms of reference for the negotiations for the Preferential Trade Agreement (PTA). The multiple MoUs were exchanged in the presence of Prime Minister Narendra Modi and Philippines President Ferdinand Romualdez Marcos Jr. today boosting ties between both the nations and enhancing their trade relations. Notably, this is President Marcos' first state visit, with both countries celebrating 75 years of strong diplomatic relations. The MoUs include cooperation in digital technologies, space, science, and tourism, and also increased cooperation between the armed forces and the coast guard, External Affairs Secretary (East) P Kumaran said in MEA media briefing in the national capital. There was adoption of Terms of Reference for the negotiations on a Preferential Trade Agreement between India and the Philippines. Incidentally, Indian and Philippine navies wrapped up their maritime cooperative activity (MCA) in the South China Sea, the first joint patrol of India and the Philippines in the waters contested by multiple countries, including China, Indonesia, Malaysia, the Philippines and Taiwan, among others. Three Indian naval vessels- involved three Indian naval vessels - a guided missile destroyer INS Delhi (D-61), and an anti-submarine corvette INS Kiltan (P-30) and the fleet replenishment tanker INS Shakti (A-57). The MoUs also include mutual legal assistance in criminal matters, a treaty on transfer of sentenced persons, and mutual legal assistance in criminal matters. 'Several MoUs were concluded and exchanged during this visit, there were 14 of them, these include mutual legal assistance treaty in criminal matters, a treaty on transfer of sentence persons, terms of reference on negotiations for India-Philippines Preferential Trade Agreement, terms of reference for service staff talks, Army, Air Force, and Navy, enhanced cooperation between coast guards,' MEA secretary Kumaran said during the ministry's special briefing. 'Cooperation in space, cooperation programme, cooperation in programme of science and technology, MoU for cooperation in digital technologies, and an implementation program for tourist cooperation,' he added. Prime Minister Modi and President Marcos also issued a commemorative stamp, themed on national flowers, Lotus for India and Sampaguita, a variety of jasmine for the Philippines. The MEA secretary has said that both countries have adopted a plan of action for 2025-2029, to guide bilateral cooperation under the elevated strategic partnerships across sectors. 'During the visit both PM Modi and President Marcos have agreed to elevate India-Philippine Strategic Partnership aimed at further our engagement including political cooperation, defence, maritime cooperation, trade and investment cooperation, health and pharma, cooperation in science and technology, space, connectivity, digital economy, fin tech, consular matter, culture, tourism and people to people exchanges and closer cooperation in regional multilateral and international issues at mutual interest. Adopted a plan of action for the period of 2025 to 2029 to guide our cooperation under the elevated strategic partnership,' Kumaran said. Earlier, Philippine President Ferdinand R Marcos Jr, addressing a joint press conference with PM Modi, hailed their strategic partnership, highlighting the agreement to cooperate on the defence and security sectors. "Today, India becomes only the fifth strategic partner for the Philippines. This new apex attests as much to the remarkably rapid growth, broadening and deepening of our 75-year-old bilateral relationship, the possibilities represented by the strong upward trajectory of our true economies as it does to the growing alignment of our interests and views on the challenges and imperatives of our time," he said. PM Modi too, at the press conference, emphasised the deep-rooted connection between India and the Philippines, stating that the two nations are "friends by choice and partners by destiny." Higlighting the 75th anniversary of diplomatic relations between the two countries, PM Modi stated that "our diplomatic relations might be new, but the connection between our cultures is very ancient. The Philippines' Ramayana - Maharadia Lawana are living proof of our centuries-old cultural ties." Declaration on the Establishment of Strategic Partnership between the two countries and the India-Philippines Strategic Partnership: Plan of Action (2025-29) MoUs included Terms of References between the Indian Air Force and the Philippine Air Force on Air Staff Talks; between the Indian Army and the Philippine Army on Army-to-Army Staff Talks and between the Indian Navy and the Philippine Navy on Navy-to-Navy Talks An MoU on the Treaty on Mutual Legal Assistance in Criminal Matters between the two countries and a Treaty on Transfer of Sentenced Persons between India and the Philippines was also signed. Programme of Cooperation in the field of Science and Technology for the period of 2025-2028 between the Departments of Science and Technology of the two countries was signed. Among the list of MoUs signed was one on the implementation Program for tourism cooperation for 2025-2028 between the two countries. Gratis e-tourist visa facility extended to Filipino nationals for a period of one year (from August 2025). An Memorandum of Understanding was signed between the two countries in the Field of Digital Technologies was also signed A Statement of Intent between Indian Space Research Organisation (ISRO) and the Philippine Space Agency on cooperation on the Peaceful uses of Outer Space was signed. There was an MoU on the Terms of Reference for Enhanced Maritime Cooperation between the Coast Guards of the two countries. Cultural Exchange Programme between the two countries was agreed on. India also agreed to extend support on a pilot project for setting up of the Philippines' Sovereign Data Cloud Infrastructure.
Times of Oman
8 hours ago
- Times of Oman
India is on track to gain bigger share in global output: Morgan Stanley
New Delhi: India is set to play a bigger role in the global economy over the coming decades, noted a recent report by Morgan Stanley. The report says with the expectation of India's credit to GDP rising and manufacturing gaining a bigger share in GDP, country's role in global economy will significantly go up. The report said that India is on track to gain more share in global output in the coming years due to a mix of strong foundational factors. These include robust population growth, a functioning democracy, stable macroeconomic policies, improved infrastructure, a rising entrepreneurial class, and better social outcomes. It stated "India will become the world's most sought-after consumer market, it will undergo a major energy transition, credit to GDP will rise and manufacturing could gain share in GDP". The report also noted that these strengths will help India become the world's most sought-after consumer market. In addition, the country is expected to undergo a major energy transition and experience stronger growth in credit and manufacturing sectors. The report added that the falling intensity of oil in India's GDP and a rising share of exports, especially services, will support fiscal consolidation. The government is likely to achieve a primary surplus within three years. This, along with reduced saving imbalance, could lead to structurally lower real interest rates. The report said this combination of high growth, low volatility, and falling interest rates supports higher price-to-earnings (P/E) ratios in the equity market. It highlighted that Indian households are shifting their investments towards equities, and this trend is expected to continue. The improved macroeconomic stability and changes in household balance sheets are supporting the sustained demand in the stock market. It also noted that even though stocks have de-rated compared to long bonds and gold, India is steadily gaining a bigger share in global GDP. The report stated that the soft earnings growth phase, which began in the second quarter of FY2025, seems to be ending. However, the market is still cautious. Despite foreign portfolio investor (FPI) positioning being at its weakest level since data began in 2000, Morgan Stanley said it remains confident in India's long-term prospects. It added that India's low beta implies it could perform well during a global bear market but may underperform during a global bull run. However, the report also warned about downside risks such as slowing global growth, worsening geopolitics, rising oil prices, and continued supply chain disruptions, especially in areas like rare earth materials and fertilizers.
