Archive · 26 Sep 2025
India Lowers FY26 Borrowing Target to ₹14.72 Lakh Crore
The Indian government is borrowing less money than initially planned for the financial year 2026, reducing the target by ₹10,000 crore to ₹14.72 lakh crore.
This decision followed discussions with the Reserve Bank of India and market participants.
The government also aims to meet the fiscal deficit target of 4.4% of GDP.
For the second half of the year, the government will borrow ₹6.77 lakh crore.
The government will conduct weekly bond auctions to complete the borrowing by March 6, 2026.
The share of long-term bonds has been reduced, while short-term bonds have increased.
Government reduced FY26 borrowing target by ₹10,000 crore, totaling ₹14.72 lakh crore.
The government consulted with RBI and market participants before making the decision.
The government aims to meet the fiscal deficit target of 4.4% of GDP for FY26.
Gross market borrowings for H2FY26 are set at ₹6.77 lakh crore.
The borrowing calendar has been extended by a week due to market feedback.
- Who
- Government of India
- What
- Reduced borrowing target for FY26 and finalized borrowing calendar for the second half of FY26
- When
- FY26, Second half of FY26 (October 2025 - March 2026)
- Where
- India
- Why
- In response to market feedback and in consultation with the RBI to finalize the borrowing calendar.
Market Participants
Government
Bond Auctions
Market Participants
Traders suggested cutting down auction size for the 10-year bond.
Government
Government raised its auction size to ₹32,000 crore for the 10-year bond.
Bond Types
Market Participants
Market appetite reduced for longer-tenure bonds
Government
Reduced the share of ultra-long bonds in the second half borrowing plan and reduced green bond issuance.
- FY26 Borrowing Target (Initial)
- ₹14.82 lakh crore
- FY26 Borrowing Target (Revised)
- ₹14.72 lakh crore
- H2FY26 Gross Market Borrowings
- ₹6.77 lakh crore
- FY26 Fiscal Deficit Target
- 4.4% of GDP
- 10-Year Bond Yield (Friday)
- 6.5%
Sources
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Government’s borrowing for FY26 lowered by ₹10,000 crore
