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| Photo Credit: K. PIchumani
The Telangana Government has decided to raise ₹2,000 crore open market borrowings through auction of securities.
The government has submitted an indent to this effect to the Reserve Bank of India (RBI) which will take up the auction process through its core banking solution e-Kuber platform on March 12. This will take the total borrowings raised by the State, starting from January 16, to ₹10,000 crore during the January-March quarter.
Interestingly, the State Government has projected to raise ₹38,234 crore during the current financial year through market borrowings and other liabilities after the Union Finance Ministry had restricted its borrowings limit. But, the borrowings by the State had crossed ₹36,000 crore mark at the end of December.
The Congress Government, which took over the reins in December, decided to seek the Centre’s intervention in ensuring that the limit of borrowings is enhanced to meet immediate financial commitments. Chief Minister A. Revanth Reddy and Deputy Chief Minister Mallu Bhatti Vikramarka met Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman in January second week and explained them about the State’s financial condition.
The Central Government has subsequently allowed the State to raise ₹9,000 crore borrowings additionally during the fourth quarter. The State Government has accordingly raised ₹8,000 crore from January 16 to March 5 through auction of securities in five instalments. With the market borrowings of ₹2,000 crore proposed to be raised on March 12, the government would cross the limit of ₹9,000 crore additional borrowings allowed by the Centre.
Senior Finance officials remained tight-lipped when asked whether the Centre had permitted additional borrowings again.
