State govt to borrow Rs 500cr from market

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Bhubaneswar: For the seventh times during the current financial year, the state government will raise Rs 500 crore from open market through security sale of five-year tenure. The state Finance Department Friday issued a notification in this regard.
The proceeds of the loan will be utilised for financing development programmes and projects in the state. The state government has already taken the required consent from the Centre to raise the loan, the notification stated.
The stock would be sold through an auction to be conducted by the Reserve Bank of India (RBI), Mumbai, July 10. Bids for the auction are to be submitted in electronic format on the RBI’s core banking solution (CBS) system – E-Kuber, on the same day between 10.30 am and 12 noon.
On the same day, the RBI would display the auction results. The successful bidder will be required to make payment July 11 before the close of banking hours.
While the borrowing of stock would commence from July 11, 2018, the loan will be repaid July 11, 2023. The interest on this borrowing would be paid twice a year – January 11 and July 11, till the end of the tenure, it said.
So far, the government has borrowed a whopping Rs 3000 crore from the open market. This amount was raised through six borrowings (Rs 500 crore each). As per the projection of the state government in the Budget for the 2018-19 fiscal, the total debt burden of Odisha will be Rs 91,943 crore by end of the current fiscal year.