New Delhi: The Union government will soon start the process of raising funds from overseas markets by issuing sovereign bonds in the second half of the current financial year fiscal, according to the Union Finance Secretary Subhash Chandra Garg.
Union finance minister, Nirmala Sitharaman in budget 2019-20 announced that the government would start raising a part of its gross borrowing programme from external markets in foreign currencies.
She added that India’s sovereign external debt-to-GDP level is among the lowest globally at less than 5 per cent.
“Policy decision has been made. The government has indicated its intent very clearly that we have now have sovereign bonds issued in foreign currency in the foreign market. Once that decision has been done now it’s a question of determining what would be right size of issuance which we will be making and the modalities there on. That process will start now,” Garg said.
He said the government will soon appoint advisers to suggest modalities for raising funds from overseas markets.
“One needs to determine the maximum amount in a year the government should be raising in the foreign currency, which foreign currency will be more stable…adviser will help us in deciding all these things soon. We will try to do the first issue within this fiscal… My sense is at the time of second half calender towards last week of September if we are in position to provide the roadmap, we should be providing that,” he added.
Overseas borrowing will be part of the overall borrowing programme of the government. The government will borrow Rs 4.48 lakh crore from the market in 2019-20, higher than the Rs 4.22 lakh crore in the previous year to meet the fiscal deficit. The gross borrowing for the current financial year has been raised to Rs 7.1 lakh crore from Rs 5.71 lakh crore in 2018-19.