Centre to raise ₹8 tn through dated securities in H1 FY26: Finance Ministry

New Delhi: The Centre plans to raise ₹8 trillion through dated securities in the first half of FY26 (April-September 2025 period), accounting for 54% of the full-year target, including ₹10,000 crore via sovereign green bonds, the finance ministry said on Thursday.

The government will raise ₹8 trillion through 26 weekly auctions, issuing securities across 3, 5, 7, 10, 15, 30, 40, and 50-year maturities.

The borrowing mix, including Sovereign Green Bonds (SGrBs), is allocated as follows: 3-year (5.3%), 5-year (11.3%), 7-year (8.2%), 10-year (26.2%), 15-year (14.0%), 30-year (10.5%), 40-year (14.0%), and 50-year (10.5%).

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“The Government will continue to reserve the right to exercise the greenshoe option to retain an additional subscription of up to ₹2,000 crore against each of the securities indicated in the auction notifications,” the ministry said.

“The Government will carry out switching/buyback of securities to smoothen the redemption profile,” it added.

A greenshoe option allows the government to raise additional funds beyond the initial target.

Debt management

To manage its debt, the government often buys back securities, using its funds to retire bonds and reduce the outstanding debt.

It also conducts bond switches, replacing shorter-duration bonds with longer ones to smoothen its liability profile.

Meanwhile, to take care of temporary mismatches in government accounts, the Reserve Bank of India (RBI) has fixed the Ways and Mean Advances (WMA) limit for H1 of FY 2025-26 at ₹1.50 lakh crore, the Ministry of Finance said in the statement.

Ways and Means Advances (WMA) are short-term credit facilities from the Reserve Bank of India (RBI) designed to help the Central and State governments manage temporary cash flow mismatches.

The central government’s borrowing plan is crucial because it impacts fiscal management, market liquidity, and interest rates.

It also determines how the government finances its fiscal deficit, influencing overall economic stability.

The latest Union budget has set a new five-year target to cut the central government’s debt to 50% of gross domestic product, give or take 1%, by March 31, 2031.

The fiscal deficit for FY26 is projected at ₹15.6 trillion or 4.4% of nominal GDP, a notch better than the 4.5% committed earlier.

In FY25, the government expects to limit the fiscal deficit to 4.8% of GDP, slightly better than the 4.9% originally estimated.

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