The Reserve Bank of India (RBI) has said that it would provide Rs 20,000 crore through ways and means advances (WMA) window to the government for meeting unexpected expenditure of the Centre in the second half of the current fiscal year, FY14.
"It has been decided, in consultation with the Government of India, that the limits for WMA for the second half of the financial year 2013-14 (October 2013- March 2014) would be Rs 20,000 crore," the apex bank said in statement on Monday.
The RBI may trigger fresh flotation of market loans when the government utilises 75 per cent of the WMA limit. Besides, the government would borrow Rs 2.35 lakh crore through dated securities (G-Secs) in the second half of the current fiscal year.
During the first half of the fiscal year, market borrowing through dated securities was at Rs 3.44 lakh crore.
The apex bank further said that the interest rate on the WMA would be equal to the repo (short term lending) rate. The current repo rate is 7.5 per cent.
Earlier this month, Economic Affairs Secretary Arvind Mayaram had said that the WMA limit for meeting unexpected expenditure has been fixed at Rs 20,000 crore.
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