The government has said it is proposing to set up a Public Debt Management Agency (PDMA) and will ensure a smooth transition to the new system.
"The government proposes to set up a Public Debt Management Agency. Transitory issues that would arise will be planned for and dealt with to ensure a smooth transition," Minister of State for Finance Jayant Sinha has said in a written reply to a question in the Rajya Sabha.
In Budget, the government had proposed to set up PDMA to manage government debt and also to shift the regulation of government bond from RBI to Sebi. However, due to opposition from the RBI the proposal could not go through.
Finance Minister Arun Jaitley had in April withdrew the proposal from Finance Bill, 2015, and said the government, in consultation with the Reserve Bank, will prepare a roadmap to pursue a separate debt management agency later in line with the global practice.
The proposals of a separate management of government debt from RBI was first mooted by the RBI itself in annual report 2000-01.
Subsequently, several independent committees have recommended setting up of an independent Debt Management Agency, equidistant from both government and RBI.
