₹8 Lakh Crore Borrowing Planned by Government in H1 FY 2025–26

The Government of India, in collaboration with the Reserve Bank of India (RBI), has finalised its market borrowing programme for the first half (H1) of the financial year 2025–26. The plan aims to ensure a stable borrowing calendar while supporting fiscal operations and providing clarity to financial markets.

Gross Market Borrowing for H1 FY26

Of the total budgeted gross market borrowing of ₹14.82 lakh crore for FY 2025–26, the Government will borrow ₹8.00 lakh crore (or 54%) during H1 through dated securities. This includes the issuance of ₹10,000 crore in Sovereign Green Bonds (SGrBs).

The borrowing will be conducted via 26 weekly auctions and will involve a mix of short-, medium-, and long-term maturities.

Maturity-Wise Allocation

The Government has structured its borrowing programme to distribute funds across a broad maturity spectrum:

• 3-year: 5.3%
  
• 5-year: 11.3%
  
• 7-year: 8.2%
  
• 10-year: 26.2%
  
• 15-year: 14.0%
  
• 30-year: 10.5%
  
• 40-year: 14.0%
  
• 50-year: 10.5%
  

This structure supports liquidity and helps develop a robust yield curve.

Green Bonds and Redemption Management

In line with the Government’s sustainability goals, ₹10,000 crore of the borrowing will be through Sovereign Green Bonds to fund environment-friendly initiatives.

Additionally, the Government plans to conduct security switching and buybacks to manage redemption pressure and smooth its repayment obligations.

Use of Greenshoe Option

To handle market dynamics better, the Government has retained the right to use a greenshoe option, allowing it to accept up to ₹2,000 crore extra in each auction over and above the notified amount, depending on demand.

Treasury Bill Issuance in Q1

Short-term funding needs will be met through Treasury Bills (T-bills), with a weekly issuance of ₹19,000 crore expected in Q1 FY26. The breakup is:

• 91-day T-bills: ₹9,000 crore
  
• 182-day T-bills: ₹5,000 crore
  
• 364-day T-bills: ₹5,000 crore
  

These instruments are important for managing liquidity and short-term fiscal needs.

WMA Limit Set at ₹1.5 Lakh Crore

To address temporary mismatches in its cash flows, the RBI has fixed the Ways and Means Advances (WMA) limit at ₹1.50 lakh crore for H1 of FY26. This provides the Government with operational flexibility without adding pressure on market borrowings.

Conclusion

The borrowing roadmap for H1 FY 2025–26 demonstrates a structured approach to public debt management. With a balanced mix of tenures, inclusion of green bonds, and mechanisms like buybacks and greenshoe options, the strategy is designed to maintain market confidence while supporting the Government’s fiscal priorities.

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