Modi govt announces Rs 70,000 crore cut in borrowing | September 29



? Cool Title, but what’s the news?

The government has cut its gross borrowing for the year by Rs 70,000 crore and stuck to the net borrowings planned in the budget, sending a strong signal about its intent to meet the fiscal deficit target for the year.

? Okay, but what does it mean?

The reduction in gross borrowings, which will be met partly from small savings and lower smaller buy-back programme, should reduce pressure on the bond market and cool bond yields.

? Why should I care?

Market was expecting a reduction in gross borrowing following upward revision in small savings rate that is expected to increase flows that government can use for meeting its fiscal deficit. Source: Economic Times
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Written by

Vedant Kaushik