“The volume of government borrowing is determined by the excess of government expenditure over non-debt revenue, and an increase in NSSF collection may not have any impact on the total volume of government borrowing, which is determined by macroeconomic considerations. However, the ratios of different sources of borrowing would change, and since NSSF instruments have a relatively higher effective interest rate compared to other sources of borrowing, including a longer rise in the market’s debt margin, there may be an effective increase in the market’s interest margin. however, there has been a reduction in the share of NSSF-based loans in the government’s gross borrowings,” Srivastava said.
