Indian govt's total debt climbs again in July-Sept. All you need to know

India’s public debt has soared to Rs 147.19 trillion, according to the latest government data. 

The total liabilities of the government increased to Rs 147.19 trillion at September-end from Rs 145.72 trillion at the end of June this fiscal year, according to the latest data on public debt.

In percentage terms, it reflects a quarter-on-quarter increase of 1 per cent in the second quarter of 2022-23.

So, how do these numbers look like in the context of India’s gross liabilities?

Public debt accounted for 89.1 per cent of total gross liabilities at September-end 2022, up from 88.3 per cent as on June 30, the quarterly report on public debt management released by the finance ministry on Tuesday said.

Nearly 29.6 per cent of the outstanding dated securities had a residual maturity of less than five years, it said.

How has the central government been raising monies?

During the second quarter, it said, the central government raised Rs 4,06,000 crore through dated securities, as against notified amount of Rs 4,22,000 crore in the borrowing calendar, while repayments were at Rs 92,371.15 crore.

And what about yields?

The weighted average yield of primary issuances hardened to 7.33 per cent in Q2 FY23 from 7.23 per cent in Q1 FY23, it said, adding, the weighted average maturity of new issuances of dated securities was lower at 15.62 years in Q2 as compared to 15.69 years in Q1.

The yields on government securities in secondary market hardened in short-end curve due to near-term inflation and liquidity concern though softening of yield was observed for the longer tenure securities during the second quarter. 

Has the central government been raising any money through the Cash Management Bills route?

During July-September 2022, the central government did not raise any amount through Cash Management Bills.

The Reserve Bank did not conduct Open Market operations for government securities during the quarter.

How much excess money has the RBI been mopping up?

The net daily average liquidity absorption by RBI under Liquidity Adjustment Facility (LAF) including Marginal Standing Facility and Special Liquidity Facility was at Rs 1,28,323.37 crore during the quarter, it said.

The Monetary Policy Committee decided to hike the policy repo rate by 100 bps, i.e., from 4.90 per cent to 5.90 per cent during Q2 largely with an intention to contain inflation. 

What did the report have to say about foreign exchange reserves?

With regard to foreign exchange reserves, the report said, it stood at $532.66 billion as on September 30, 2022, moderating from $638.64 billion on September 24, 2021.

Between July 1, 2022 and September 30, 2022, the rupee depreciated by 3.11 per cent. The value of rupee against the dollar as on July 1 stood at 79.09 as against 81.55 on September 30, it said.