Government to borrow 53.1% of FY25 target in H1

The Centre on Wednesday announced it will borrow more than 53% of its budgeted gross market borrowings of ₹14.13 lakh crore for 202425 in the first half.

Of the ₹7.5 lakh crore planned to be raised between April and September, about ₹12,000 crore would be through Sovereign Green Bonds. While more than a quarter of this will be through 10year bonds, the Finance Ministry will introduce a new 15year bond that will be used to raise over ₹1.04 lakh crore.

The Reserve Bank of India (RBI) has modified norms for regulated entities (REs) concerning their investments in Alternative Investment Funds (AIFs).

As per the fresh directive, REs need to only set aside provisions to the extent their investment in an AIF scheme is further invested by the AIFs in a debtor’s company, and not the entire investment in the AIF scheme.

“With a view to ensuring uniformity in implementation among the REs, and to address the concerns flagged in various representations received from stakeholders, it is advised that downstream investments shall exclude investments in equity shares of the debtor company of the RE, but shall include all other investments, including investment in hybrid instruments,” the RBI said on Wednesday.

“Provisioning shall be required only to the extent of investment by the RE in the AIF scheme which is further invested by the AIF in the debtor company, and not on the entire investment of the RE in the AIF scheme,” it added.

Investments by REs in AIFs through intermediaries such as fund of funds or mutual funds are not included in the scope of the circular. The RBI had in December prevented REs from making investments in AIFs having downstream investments either directly or indirectly in any debtor’s company of the REs. This was to stop the evergreening of loans.