Eight states issued Rs 98,960 cr of bonds under UDAY

Bonds can be used as an eligible security to borrow from the RBI

The Reserve Bank of India (RBI) on Friday said eights states issued Rs 98,960 crore worth of bonds under the UDAY (Ujwal DISCOM Assurance Yojana) scheme.

The bonds, though eligible for market repo, were privately placed so that the bond market doesn't get disrupted. Market repo indicates bonds that can be used as an eligible security to borrow from the RBI.

With a coupon that was higher by as much as 75 basis points above equivalent maturity 10-year bonds, and the ability to use them for repo made the bonds attractive buy.

Read more from our special coverage on "UDAY"

• UP to issue bonds worth Rs 40,000 cr to discoms under UDAY
• J&K to gain Rs 9,800 crore after joining UDAY
• Haryana joins UDAY scheme, to save Rs 14,160 crore
• Punjab 7th state to join UDAY; to save Rs 5,475 crore

However, the bonds being over and above the announced market borrowings, the central bank decided to make the bonds privately placed.

Under the scheme, Rajasthan issued Rs 37,349 crore, Uttar Pradesh Rs 24,332 crore, Chhattisgarh Rs 870 crore, Punjab Rs 9,860 crore, Jammu & Kashmir Rs 2,140 crore, Bihar Rs 1,551 crore, Jharkhand Rs 5,553 crore and Haryana Rs 17,300 crore of bonds, RBI's said in a statement on its website.