"The assumptions on financing from sources other than government bonds look relatively aggressive"The government's plan to buy back nearly one trillion rupees of maturing bonds (out of 2.3 trillion rupees in total) and issue around 6 trillion rupees implies flat net issuance versus FY2018. "A scenario of slower pace in fiscal consolidation - if confirmed - should demand a higher premia from Indian government bonds." The government had budgeted net market borrowing of 3.48 trillion rupees and bond buybacks of 750 billion rupees in February last year. On Thursday, Finance Minister Arun Jaitley upped the bond sales to 4.02 trillion rupees while cutting repurchases to 570 billion rupees. "The overall fiscal deficit is higher," said Naveen Singh, head of fixed-income trading with ICICI Securities in Mumbai.

Source: Economic Times February 05, 2018 07:52 UTC