Total market borrowings this year stand at Rs3,500 cr
BBN Bureau
THIRUVANANTHAPURAM/August 03-2022: At last, Kerala raised Rs2,000 crore through market borrowing on Tuesday (August 02) by issuing 13-year state development bonds (SDLs) at a coupon rate of 7.85 per cent.
This takes the total borrowing of the state in the current financial year to Rs3,500 crore, the other Rs1500 crore having been raised on May 31. Kerala, along with some other states, has been advised by the Centre to go slow on borrowing from the market allegedly to adjust against its off-balance sheet borrowings made through KIIFB and KSSPL.
ICRA, the leading rating agency, said in a note that 15 state governments raised Rs20,900 crore through state development loans (SDLs) on August 02, 2022, about 24 per cent higher than the Rs16,900 crore that was initially indicated for this week in the second quarter (Q2 FY2023) auction calendar.
Though the borrowing calendar prepared by RBI is not meant for strict compliance, Kerala’s borrowing went totally away from calendar; while the Q1 borrowing calendar projected a borrowing of Rs9,000 crore, the actual borrowing was to the tune of just Rs1000 crore.
Against the calendar projection for Q2 at Rs9,000 crore, the borrowing until August 02 stands at Rs2000 crore. KN Balagopal, the finance minister of Kerala, has already registered his objection to the Centre’s instruction to amortise the state’s off-balance sheet borrowing during FY22 over the next four years.
