The Chief Economic Adviser, V. Anantha Nageswaran, announced on Monday that the Indian government's market borrowings for the second half of the current financial year will remain unchanged. This decision comes amidst India's plans to borrow Rs 14.82 trillion ($167.87 billion) for the financial year ending March 31, with Rs 6.8 trillion slated for borrowing in October-March.
In an interview with CNBC-TV18, Nageswaran expressed confidence in maintaining the fiscal deficit target despite the unchanged borrowing for the second half of the financial year. India has projected a fiscal deficit of 4.4% of GDP for the fiscal year 2025/26. Additionally, Nageswaran expects the inflation trend in India to remain benign until the end of the next calendar year.
Retail inflation in India stood at 2.07% in August, with economists foreseeing a decrease in inflation due to consumer tax cuts on food and household items in the upcoming months. This news is expected to provide relief to consumers who have been facing rising prices in recent months.
The current exchange rate is $1 to 88.2800 Indian rupees.
Overall, the Indian government's decision to maintain market borrowings for the second half of the financial year signifies a commitment to fiscal responsibility and stability. This move, coupled with projections of controlled inflation, indicates positive economic prospects for India in the coming months.
