The central government has announced that it will borrow Rs 6.77 lakh crore from the market in the second half of the current financial year (October 2025 to March 2026), modestly trimming its full-year borrowing projection.
The revised figure is RS 10,000 crore lower than the borrowing target announced in the Union Budget for FY 2025-26.
The government’s Gross Market Borrowing of Rs 6.77 lakh crore will be executed through 22 weekly auctions, concluding on March 6, 2026. The borrowing will be distributed across securities with maturities of 3, 5, 7, 10, 15, 30, 40, and 50 years. The allocation of borrowing, including State Government Borrowings (SGrBs), across these maturities is as follows: 3-year (6.6%), 5-year (13.3%), 7-year (8.1%), 10-year (28.4%), 15-year (14.2%), 30-year (9.2%), 40-year (11.1%), and 50-year (9.2%).
Additionally, the Government will continue implementing switching and buyback operations to smoothen the redemption profile of outstanding securities.
In a statement, the Finance Ministry said: “The Government of India plans to borrow ₹6.77 lakh crore in the second half of the fiscal year 2025-26 (H2: FY26) through dated securities, including ₹10,000 crore through issuance of Sovereign Green Bonds (SGrBs).”
H1 Borrowing
For the April-September period, the Centre had originally planned to raise Rs 8 lakh crore. However, it ended up borrowing Rs 7.95 lakh crore, falling short of the target by Rs 5,000 crore. The adjustment in the first half has been mirrored in the October-March plan, effectively reducing the annual borrowing programme.
Auction calendar
According to the government, the second-half borrowing of Rs 6.77 lakh crore will be raised through 22 weekly auctions of dated securities, concluding by March 6, 2026. These auctions will include issuance across different maturities to ensure a balanced debt structure and market stability.
Full-Year Outlook
In the Union Budget for FY26, gross borrowing was pegged at Rs 14.82 lakh crore. With the revised borrowing in both halves of the year, the total gross borrowing for FY26 now stands at Rs 14.72 lakh crore, slightly below the Budget estimate.
The government’s borrowing programme is a crucial component of fiscal management, as it helps finance the fiscal deficit while also supporting expenditure plans, including infrastructure investments and welfare schemes.
Significance of Sovereign Green Bonds
SGBs are government-issued debt securities designed to finance projects with positive environmental impact. The funds raised through these bonds are exclusively directed toward green initiatives, such as renewable energy, sustainable agriculture, waste management, and other eco-friendly projects.
Notably, the plan includes Rs 10,000 crore of borrowing through Sovereign Green Bonds, reflecting the Centre’s continued focus on financing climate-friendly and sustainable projects.
Market analysts say the marginal reduction in borrowing is a positive signal for bond markets, as it could ease upward pressure on yields, particularly when inflation and interest rate trends remain in focus.
How do SGrBs work
When you invest in sovereign green bonds, your funds directly support projects with positive environmental impact. These are government-backed bonds in India, which means the government pays regular interest-usually semi-annually-and returns the principal at maturity.
For example, if you invest Rs 10,000 in a 10-year sovereign green bond with a 7.29% interest rate, you would earn approximately Rs 364.50 every six months. At the end of 10 years, you would receive your Rs 10,000 principal along with the final interest payment.