Current Affairs PDF

Tamil Nadu Tops Market Borrowings Among States in India With a Collection of ₹30,500 crore for 2020-21 : RBI

AffairsCloud YouTube Channel - Click Here

AffairsCloud APP Click Here

Tamil Nadu tops market borrowingsOn July 09, 2020, According to data from the Reserve Bank of India (RBI), Tamil Nadu (TN) has topped market borrowings among States in India with a collection of Rs.30,500 crore in the fiscal 2020-21(FY 21).

  •  TN, which has accounted for 17% of the borrowings done through the issue of bonds (known as state development loans), has been followed by Maharashtra ₹25,500 crore (14%), Andhra Pradesh ₹17,000 crore (9%), Rajasthan ₹17,000 crore (9%).

TN’s borrowing:

Earlier on July 7, 2020, Tamil Nadu raised ₹1,250 crore at the low interest rate of 6.63% for the 35-year bonds and ₹1,250 crore at the rate of 4.54% for the three-year bonds in the auction conducted by RBI.

  • In addition, it has also raised an additional amount of ₹500 crore in place of originally planned ₹2,000 crore through the issue of 35 years and 3 years bond with ₹1,000 each .It also have a ‘green shoe’ option to raise a further ₹250 crore in each of these securities.

What is the need?

The state Government has raised the amount through the issue of long tenure bonds rather than short-terms funding tools like Ways and Means Advances (WMA) to meet the increased expenditure and falling revenue situation amid the coronavirus (COVID-19) pandemic.

The Finance Secretary projected that the TN will witness a shortfall in revenue of about ₹12,000-₹13,000 crore a month.

The GST (Goods and Services Tax) collection of TN has sharply reduced by 15% in June 2020, higher than the 3% fall in national GST collections due to the continuous lockdown.

About Reserve Bank of India (RBI):
Headquarters– Mumbai, Maharashtra
Governor– Shaktikanta Das
Deputy Governors– 4 (Bibhu Prasad Kanungo, Mahesh Kumar Jain, Michael Debabrata Patra, one is yet to be appointed).