The government will borrow an additional Rs 46,000 crore during the current fiscal to bridge the revenue expenditure gap, which has been ballooning on account of stimulus packages and tax concessions announced to spur the economy.
“We had discussions with (the) Reserve Bank. (The) borrowing (extra) between February 20 and March 20 is going to be Rs 46,000 crore,” Economic Affairs Secretary Ashok Chawla told reporters after meeting RBI Deputy Governor Shyamala Gopinath.
The government will be borrowing Rs 46,000 crore from the money market in four tranches, he added.
The RBI, Gopinath said, “will ensure that it (borrowings) is carried in a non disruptive manner.”
The government, Chawla had told reporters on Monday, has provided a stimulus of Rs 1,50,000 crore by way of excess expenditure and about Rs 50,000 crore by way of tax concessions to the industry to battle slowdown.
“This year because of stimulus, because of downturn, the (borrowing) requirement has been more. Therefore, whatever is the requirement of the government, it will have to be met through borrowing,” he had said.
At a time when revenue collections are not buoyant, the government through two supplementary demands for grants raised the public expenditure by 20 per cent, over and above earmarked in the budget for 2008-09, and slashed excise duty by 4 per cent to fuel economy reeling under the impact of the global financial meltdown.