During Q3 of FY17, the Government issued dated securities worth Rs.161,000 crore taking the Gross Borrowings in April-December of FY17 to Rs. 5,02,000 crore or 83.7% of BE, vis-a-vis 85.6% of BE in April-December of FY 16. Net market borrowings from April-December of FY17 were at Rs.362,012 crore, 85.1% of BE. Auctions of both Government dated Securities and Treasury Bills, during Q3 of FY17 were held in accordance with the pre-announced issuance calendar. In the 11 tranches of G-securities auction, five new securities, namely 7.06% GS 2046, 6.51% FRB 2024, 6.62% GS 2051, 6.57%GS 2033 and 6.79% GS 2029 were issued during the Quarter on October 10, November 7, November 28, December 5 and December 26, 2016, respectively.
The Weighted Average Maturity (WAM) and Weighted Average Yield (WAY) issued during Q3 FY17 was 15.59 years and 6.7%. The liquidity condition in the economy continued to improve during the quarter. The cash position of the Government during Q3 of FY17 was comfortable and remained in surplus mode.
The Public Debt (excluding liabilities under the ‘Public Account’) of the Central Government provisionally increased by 2.4% in Q3 of FY 17 on Q-o-Q basis. Internal debt constituted 92.6% of Public Debt as at end-December 2016, while marketable securities accounted for 83.6% of Public Debt. About 26.6% of outstanding stock has a residual maturity of up to 5 years at end – December 2016, which implies that over the next five years, on an average, around 5.3% of outstanding stock needs to be repaid every year. Thus, rollover risk in the debt portfolio continues to be low. The implementation of budgeted buy back/ switches in coming period is expected to further reduce roll over risk.
G-sec yields declined sharply across the curve during the quarter, post the Government’s decision on November 8, 2016 to demonetize high denomination value notes which was viewed positively by market as deposits were expected to surge in banks and led to bullish market sentiment, particularly for short end bonds. The bullish market sentiment was however, restrained to a certain extent with rise in global crude prices on OPEC agreement with Russia in its meeting to cut oil output, hiking by US Fed of key policy rate by 25 bps and FOMC commentary suggesting further rate hikes at a faster pace. The trading volume of Government Securities on an outright basis during Q3 FY 17 decreased by 11.87% over the previous quarter.
The Public Debt Management Quarterly report for the period October - December 2016 is attached for your kind reference.
The Embassy of Japan in New Delhi and the Centre for Policy Research are pleased to invite you to a workshop on
Quality Infrastructure: Japanese Investment in India
Monday, 27 February 2017, 9:00 a.m. - 2:00 p.m.
Official development assistance from Japan has contributed substantially to India's efforts in priority areas like power, transportation, environment and human development. Concomitantly, supported in part by such infrastructure investments, investment from the Japanese private sector in manufacturing has grown. Recently, at the 2016 G7 Ise-shima summit Japan announced the “Expanded Partnership for Quality Infrastructure”, building on its earlier initiative at the 21st International Conference on the Future of Asia in Tokyo. With this Partnership, the Government of Japan promotes “quality infrastructure investment” in collaboration with other countries and international organisations. To that end, Japan, will provide approximately USD 200 billion for “quality infrastructure development” over the next 5 years.
There are five aspects to quality infrastructure, viz. (a) effective mobilisation of financial resources through PPP; (b) ensuring alignment with socio-economic development and development strategies of developing countries/regions; (c) application of high-quality standards, regarding compliance with international standards established to mitigate environmental and social impact; (d) ensuring the quality of infrastructure, in particular, aspects of economic efficiency and durability, inclusiveness, safety and resilience, sustainability and convenience and amenities and finally, (e) contribution to the local society and economy.
The workshop will be inaugurated by His Excellency, the Ambassador of Japan to India. Mr Amitabh Kant, CEO of NITI Aayog will deliver the keynote address. Other key speakers include Mr. Koki Hirota, Chief Economist of JICA from Japan and Mr R C Bhargava, Chairman of Maruti Suzuki and representatives of industry from Japan and India. The event will be followed by interaction over lunch. More information about the event (including the programme schedule) can be accessed here.