RBI Governor Sanjay Malhotra mentioned that the government’s borrowing program is relatively low, allowing for cost-effective resource mobilization. Emphasizing the importance of net borrowing over gross figures, he noted that despite higher gross borrowings due to redemptions, net borrowings stand at Rs 11.73 lakh crore, only slightly higher than last year.
Malhotra highlighted the government’s plan to utilize Treasury Bills for fundraising, aiming to enhance yield curve management and borrowing efficiency. He expressed confidence in managing liquidity to facilitate the transmission of previous repo rate cuts into the economy without immediate changes.
Furthermore, the RBI Governor welcomed tax incentives for data centers, anticipating increased investments in digital infrastructure. He also expressed optimism about India’s external account outlook, citing trade agreements to boost exports, attract foreign investments, and improve productivity.
Regarding the macroeconomic landscape, Malhotra affirmed India’s capability to meet external sector demands, noting favorable inflation levels and stronger growth compared to previous assessments by the monetary policy committee.
