Government debt News

Days ahead of the budget, Moody's on Thursday said its positive outlook on India reflects expectations of continued policy reforms reducing government debt even as it feels that the high debt level limits room to cut fiscal deficit quickly.

The Finance Ministry is seeking comments of other ministries on creation of a shell public debt management agency (PDMA), an interim arrangement before the launch of a full-fledged agency to manage government debt.

India`s central bank is committed to steadily increasing how much government debt foreign investors can buy, but will proceed cautiously to avoid becoming too reliant on overseas capital, Governor Raghuram Rajan said on Thursday.

Government's total debt increased by 0.9 percent in the fourth quarter ended March 31, over the previous thee-month period of the current financial year.

Investment limits for government debt securities worth Rs 2,684 crore will be auctioned for overseas investors on the National Stock Exchange (NSE) on Monday.

The Reserve Bank of India (RBI) said on Tuesday it was preparing to widen trading for less liquid government bonds and would let banks buy into infrastructure bonds, continuing efforts to develop the country`s debt markets.

As a new agency takes shape for taking over public debt management role from RBI, Governor Raghuram Rajan today favoured keeping this entity independent of the government as well as the central bank to ensure fiscal discipline.

Yields on bonds of southern eurozone countries touched record lows in secondary trading Friday, a day before the ECB is slated to begin 60 billion euros (USD 66 billion) in monthly purchases.

RBI Governor Raghuram Rajan today said government debt is not yet a problem for India even as Standard & Poor's stated that high government debt is putting the sovereign rating under pressure.

India's public debt position is comfortable on account of declining trajectory of central government liabilities and stable interest cost, Finance Minister Arun Jaitley said Wednesday.

Reserve Bank Governor Raghuram Rajan on Wednesday said the cap on foreign portfolio investments in the government debt will be increased in a "steady" and "measured" manner.

India attracted 49.63 billion rupees ($814.61 million) worth of bids from foreign investors in its auction of government debt limits on Thursday, much higher than the 30.17 billion rupees on offer, according to two dealers.

Once 90 percent of limit is utilised, FIIs are not allowed to further increase their long position in IRF.

The Reserve Bank of India`s (RBI) decision to sell USD 2.3 billion in government debt through the unpopular `multiple pricing` method could push yields higher when trading resumes on Wednesday after a holiday, dealers said.