Page 2 - State Govt Market Borrowings

States borrowing cost continues to fall for 4th week, down 6 bps to 7.46%

The borrowing cost for the states fell for the fourth consecutive week as the weighted average cut-off eased 6 basis points (bps) to 7.46 per cent at the weekly auctions on Tuesday. Ten states have raised Rs 10,500 crore at the latest auction of state development loans, which is 1.5 per cent higher than indicated in the borrowing calendar, a first in a couple of years. Since the outbreak of Covid, states were borrowing much lower than indicated amount thanks to higher grants from the central government. last week the Centre released Rs 58,300 crore as tax devolution for July, up from Rs 47,600 crore each in the first quarter. Additionally, the Centre had approved Rs 31,500 crore of special assistance for capital expenditure to 10 states during that month. The weighted average cut-off has eased by 6 bps to 7.46 per cent from the past week, despite the weighted average tenor increasing to 14 years from 13, and the spread between 10-year state debt and the 10-year G-Secs (Government ..

RBI pegs state govt market borrowing for July-Sept at Rs 2.1 trillion

Actual borrowings and state-wise breakup will be intimated 2-3 days prior to auction day; RBI to try and ensure auctions are held in non-disruptive manner considering mkt conditions

State market borrowings down 23.7% YoY in Q1FY23 on strong cash flows

Icra said a comfortable cash flow position of the state governments was due to a back-ended release of tax devolution to the states in FY2022

Borrowing costs rise sharply for states on Ukraine-led geopolitical strife

Cut- off for state Development Loans up by 19 bps this week over auction held last week

Borrowing by state govts 11% lower than last year: CARE Ratings

25 states, 1 UT have raised Rs 2.92 trn, against Rs 3.27 trn by 27 states, 2 UTs last fiscal

Tamil Nadu, India's 2nd-most industrialised state, in favour of debt recast

The states' inflated debt sale schedule alludes to that possibility. They are scheduled to borrow as much as Rs 1.78 trillion ($25 billion) from the market in the April-June quarter

States close FY21 with borrowing 3% less than notified Rs 8.24 tln

This is is Rs 25,393 crore or around 3 per cent less than the indicated debt for the fiscal

FinMin releases Rs 6K crore to states to meet GST compensation shortfall

The Centre had set up a special borrowing window in October 2020 to meet the estimated shortfall of Rs 1.10 trillion in revenue arising on account of implementation of GST

States' market borrowings jump 55% to Rs 3.75 trillion so far this fiscal

The states' market borrowings have jumped 55% to Rs 3.75 trn, or 75% of the budgeted amount, with 17 of them raising an additional Rs 22,350 crore from the latest auction of state development loans

13 states submit borrowing option to Centre to fund GST shortfall

These 13 states include Bihar, Odisha, Andhra Pradesh, Gujarat, Uttarakhand and Meghalaya

GST row: Compensate states that picked a borrowing option, says Sushil Modi

While Bihar, Gujarat, Karnataka, Tripura and Madhya Pradesh opted for the Reserve Bank of India (RBI) window, Manipur and Sikkim went for market borrowing

Amid Centre-states GST row, a white-knuckle moment for bond markets

Centre-state GST equation to be keenly watched

In absence of GST compensation, states may cut FY21 capex by Rs 3 trn: ICRA

The borrowing alternative offered by the Centre to make up for the shortfall in the promised compensation will lead to the states' fiscal deficits widening to 4.25 - 5.52 per cent

Entire GST shortfall will be compensated, says govt ahead of Sept 10 meet

The finance ministry ruled out borrowing by the Centre as suggested by some states

Centre, state finmin officials thrash out GST compensation gaps

The states were informed that if they take the option of borrowing Rs 97,000 crore under a special window, they will still get Rs 2.35 trillion minus Rs 97,000 crore from the compensation cess

States' fiscal deficit likely to hit 4.2-5.5% of GSDP this fiscal year

This may take the general deficit of the country-- both the Centre's and states'-- to 11-14 per cent of GDP in FY21

Managing markets

Bond and currency markets would increase policy difficulties

States continue to tap cheap rates to borrow more than originally planned

Seven state governments had lined up to borrow Rs 9,000 crore, but ended up borrowing Rs 12,000 crore from the markets because of the cheap rates.

Borrowings by states double in lockdown owing to severe revenue crunch

Market borrowings at over Rs 1.26 trn in April-early June, against Rs 60,000 cr in the year-ago period

Punjab approves reforms to avail additional borrowing of 1.5% of GSDP

The additional borrowing would help state tide over the estimated 30 per cent revenue shortfall in 2020-21 fiscal