Centre completes 89% mkt borrowing by mid-Jan

The Centre has completed nearly 89 per cent of its Rs 4.47 lakh crore market borrowing for 2010-11 by mid-January, indicating more funds would be available for corporate in the remaining period of the fiscal.

"Nearly 89 per cent of the government of India's gross market borrowing programme for 2010-11 was completed during the year (up to January 19, 2011)," the Reserve Bank of India (RBI) today said in its Macroeconomic and Monetary Developments report.

Encouraged by buoyancy in tax and non-tax revenue, including receipts under 3G spectrum auctions, the government had scaled down its gross borrowing for the fiscal by Rs 10,000 crore to Rs 4.47 lakh crore.

The government received over Rs 1 lakh crore from the sale of 3G telecom and broadband licences, against Rs 35,000 crore it estimated in the Budget.

In the wake of robust growth of the economy the government has also revised upwards the Budget target of tax revenue to Rs 7.82 lakh crore from Rs 7.45 lakh crore for the current fiscal.

The liquidity conditions tightened significantly towards the close of 2010 promoting RBI to take steps to ease flow of funds into the market.

Regarding the state government market borrowings, the RBI report said about 50 per cent of the gross allocations for the states for 2010-11 were raised by 22 states up to January 19, 2011 as compared to nearly 90 per cent of the gross borrowings raised during the comparable period of 2009-10.

"Taking into account the comfortable cash balances of the state governments coupled with buoyant National Savings Scheme Fund (NSSF) flows there may be a moderation in their borrowings for 2010-11," it said.

The RBI will tomorrow come out with third quarter monetary policy review.