Winning Bizness Desk

Mumbai. The Indian government is set to borrow ₹8 lakh crore from the market between April and September 2025, which accounts for 54% of the total annual borrowing target of ₹14.82 lakh crore for FY26. This decision is aimed at meeting the fiscal deficit target of 4.4% of GDP. The borrowing will help bridge the gap between government revenue and expenditure, ensuring smooth financial operations.

Government to Issue ₹10,000 Crore in Green Bonds

To raise funds, the government will issue ₹10,000 crore worth of green bonds, which will be used for environmentally sustainable projects. Additionally, in the first quarter of FY26 (April-June), the government will release ₹19,000 crore worth of treasury bills every week to meet short-term financial requirements.

Various Maturity Bonds to be Issued

The government plans to issue government securities (G-Secs) with maturities of 3, 5, 7, 10, 15, 30, 40, and 50 years. Among these, over 26% of total borrowing will be raised through 10-year bonds, which are preferred by investors for their stability. To reduce the burden of redeeming old bonds, the government will also conduct switching operations and security buybacks.

Fiscal Deficit Target Set at 4.4% of GDP

On March 25, Finance Minister Nirmala Sitharaman presented the Finance Bill in Lok Sabha, reiterating the government's commitment to reducing the fiscal deficit to 4.4% in FY26. This is part of a broader fiscal consolidation strategy aimed at balancing government spending and revenue generation while supporting economic growth.

Key Budget Highlights for FY26

The Union Budget 2025-26 outlines a total expenditure of ₹50.65 lakh crore, which is 7.4% higher than the current fiscal year. The capital expenditure target is ₹11.22 lakh crore, with an effective capital expenditure of ₹15.48 lakh crore. To support this, the government aims to collect ₹42.70 lakh crore in gross tax revenue and borrow ₹14.01 lakh crore. These measures reflect the government's focus on infrastructure development, economic stability, and fiscal discipline.

Key Takeaways

• ₹8 lakh crore borrowing planned in the first half of FY26, covering 54% of the annual target.
• Government to issue ₹10,000 crore in green bonds and ₹19,000 crore in treasury bills weekly.
• 26% of total borrowing will be through 10-year government bonds.
• Fiscal deficit for FY26 set at 4.4% of GDP, focusing on financial stability.
• Total expenditure for FY26 to rise by 7.4%, with a significant focus on capital expenditure and economic growth.