Govt’s total liabilities rise 2% to ₹128.41 lakh cr. in Dec. quarter

Government debt accounted for 91.60% of total outstanding debt in the December quarter, compared to 91.15% at the end of September

Government debt accounted for 91.60% of total outstanding debt in the December quarter, compared to 91.15% at the end of September

Total government liabilities rose to 128.41 lakh crore in the December quarter, from ₹ 125.71 lakh crore in the three months ended September 2021, according to the latest government debt management report.

The increase reflects a quarter-over-quarter increase of 2.15% in October-December 2021-22.

In absolute terms, the total liabilities, including liabilities under the government’s ‘Public Account’, increased to 1,28,41,996 crore at the end of December 2021. As of September 30, total liabilities were ₹1,25,71,747 crore.

The report released Monday by the Treasury Department said government debt made up 91.60% of total outstanding debt in the December quarter, compared to 91.15% at the end of September.

Nearly 25% of the outstanding dated securities had a remaining maturity of less than 5 years.

The ownership pattern of central government securities indicates that the share of commercial banks stood at 35.40% at the end of December 2021, down from 37.82% at the end of September 2021.

Share of insurance companies and provident funds was 25.74% and 4.33% respectively at the end of December 2021. Mutual funds share was 3.08% at the end of the December 2021 quarter compared to 2.91% at the end of the September 2021 quarter . of the RBI fell 16.92% at the end of December 2021, from 16.98% at the end of September 2021,” the report said.

The central government issued dated securities worth 2.88,000 crore, up from ₹2.83,975 crore in the third quarter of FY21, while repayments totaled ₹75,300 crore, it said.

During the quarter, it said, Treasury yields hardened across the curve.

On the domestic front, the market was largely disappointed by the RBI’s withdrawal of the Government Securities Acquisition Plan in the third quarter. The spread of the Omicron variant of the coronavirus to most parts of the country sparked fears of additional borrowing, and higher retail inflation also impacted sentiment.

Yields on the 10-year benchmark rose from 6.22% at the end of the September quarter to 6.45% at the end of the third quarter, hardening by 23 basis points in October-December.

However, returns were supported by the Monetary Policy Committee (MPC) decision to keep the policy repo rate unchanged at 4%, with a view to adopting an accommodative stance in Q3 FY22.

www.thehindu.com

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