The government is likely to borrow less in the new fiscal year that begins on April 1 than in 2012-13 because of its surplus cash balance, two government sources said on Monday.

Lower government borrowing could help bolster India's growth prospects by reducing borrowing costs for private investors and facilitating a pick-up in capital investments, which are projected to hit at least a five-year low this fiscal year.

The government has built up a cash surplus of Rs. 80,000 crore as a result of deep spending cuts to keep the fiscal deficit down at 5.3% of GDP this fiscal year. The government has set a target of cutting its fiscal deficit to 4.8% of GDP in the next fiscal year.