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India says debt rollover risk in next five years low

Reuters  |  MUMBAI 

(Reuters) - The Indian government's rollover risk in the next five years is low given the amount of domestic that needs to be repaid every year is an average of 5.3 percent of its outstanding stock, it said in a report on Tuesday.

The rollover risks will get further mitigated through buyback or switching of short-end bonds with longer tenure papers by the in the market, it said in its quarterly management report.

"The implementation of budgeted buyback/switches in coming period is expected to reduce rollover risk further," the finance ministry said.

bought back 170.16 billion rupees worth of bonds maturing in 2017/18 and sold in its place 2024/25 and 2029/30 papers to a bank in June under one of its switches, it said in the report.

The also bought back 277.67 billion rupees of short-dated securities last week as a part of its management operation to reduce risks of bulk payouts next year.

Meanwhile, banks' holding of as of end-March eased to 40.5 percent of outstanding stock from 41.8 percent a year ago, while insurers increased their holdings to 22.9 percent from 22.2 percent in March 2016.

The central bank's holding of sovereign also went up to 14.7 percent of the total stock as of March 2017 from 13.5 percent a year ago.

(Reporting by Suvashree Dey Choudhury; Editing by Subhranshu Sahu)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, December 05 2017. 15:02 IST