The Andhra Pradesh government raised an additional ₹ 4,000 crore through open market borrowing (OMB) at the end of the calendar year to meet expenditure and cash flow requirements. The loan was made through the Reserve Bank of India (RBI) through an auction of government securities.
With this latest tranche, the total open market borrowings mobilized by the state during the current calendar year has crossed ₹86,000 crore. The loan at the end of the year was required by ordinary fiscal obligations, including social security payments, infrastructure spending and settlement of outstanding accounts. Officials say the loan was made strictly in accordance with RBI norms and within the limits approved for the state.
Data on the pattern of government borrowing reveal a constant and persistent dependence on monthly securities auctions. The government raised funds through RBI-led auctions almost every month, with borrowings not falling below ₹1,000 crore in any month. In May, the state raised ₹7,000 crore, the highest monthly borrowing during the year. Significant loans followed in June, including a tranche of ₹6,000 crore and another ₹5,550 crore raised in the same month. Borrowings remained elevated in the second half of the year, touching ₹5,000 crore each in August and September.
Officials noted that the use of marketplace loans typically intensifies towards the end of the financial and calendar year, when spending peaks. They said the funds raised will help ensure continuous implementation of government programs and timely payments to suppliers, beneficiaries and ministries.
Officials attributed the higher borrowings during these months to increased expenditure on liabilities arising from social programmes, development works and settlement of accrued liabilities. According to them, monthly securities auctions have become a routine feature of state finances at a time of growing liabilities.
The government emphasized that it is following a calibrated approach to debt management, balancing development priorities with fiscal prudence. Officials also pointed out that loans are structured into different periods to manage repayment pressure.
According to official sources, the maturity of these market loans ranges from 6 to 16 years, with some securities having an obligation to repay until 2046.
While longer-term instruments help spread repayments over time and ease immediate fiscal stress, they also commit future governments to repaying the debt over decades. With a significant portion of the ₹86,000 crore raised this year falling under the medium and long-term category, Andhra Pradesh’s long-term debt profile has come under severe scrutiny.
The scale and frequency of borrowing has attracted the attention of fiscal analysts and financial institutions monitoring the sustainability of national debt. But officials say all borrowing is within approved limits and remains necessary to maintain administrative continuity and fund key development and social initiatives.
Published – 30 Dec 2025 20:50 IST
