Government will issue 'Sovereign Green Bond', plans to raise ₹20000 crore in the current financial year
Sovereign Green Bonds: According to the Finance Ministry, green bonds will be issued in four installments of Rs 5,000 crore. The first issue of 10-year sovereign green bonds of Rs 5000 crore will come from November 25 to 29. The second issue, a 30-year bond of Rs 5,000 crore, will come between December 9 and 13. Read the news for information on further issues.
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The central government plans to raise Rs 20,000 crore through 'Sovereign Green Bond' in the second half of the financial year 2025 (October-March). This information has been given in a release. According to the Finance Ministry, the government plans to complete the borrowing for the second half of FY 25 through 21 weekly auctions.
According to the Finance Ministry, green bonds will be issued in four installments of Rs 5,000 crore. The first issue of 10-year sovereign green bonds worth Rs 5,000 crore will come from November 25 to 29. The second issue, a 30-year bond worth Rs 5,000 crore, will come between December 9 and 13. The third green bond for a period of 10 years will be issued between January 27 and 31 and the last installment of 30-year green bonds will come between February 17 and 21.
Sovereign green bonds are the government debt that will be used, one way or another, solely to finance projects related to helping India transition toward a low-carbon economy. Apart from this, the Centre has also kept the right to exercise the 'green-shoe option' to accept additional subscriptions up to Rs 2,000 crore against each security mentioned in the auction notifications. This will give room to the government to accommodate an increased demand coming from the investors.
It has estimated the borrowing of the central government through treasury bills at Rs 19,000 crore for 13 weeks in the third quarter of FY25, i.e., from October to December. Apart from this, to meet temporary mismatches in the flow of government accounts, RBI has fixed the Ways and Means Advances limit for the second half of FY25 at Rs 50,000 crore. This will ensure adequate liquidity to meet short-term financing requirements.
The Finance Ministry said in a release that the central government has finalized its borrowing program for the second half of 2024-25 in consultation with the Reserve Bank of India. According to the release, out of this, Rs 6.61 lakh crore, which is 47.2 per cent of the total borrowing program target, will be raised by issuing securities and bonds in the second half of the financial year (October-March).
