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SBI Research in its latest report has said that given the record government borrowing plan of Rs 14.3 lakh crore for FY23, the Reserve Bank of India (RBI), which already holds as much as 17 per cent of the Rs 80.8 lakh crore outstanding government bonds, will have to find buyers for at least Rs 2 lakh crore, as banks typically opt for short-term debt of under 10-years.

The Budget 2023 has pegged the Centre's gross borrowing at a record Rs 14.3 lakh crore. Together with the states, the gross borrowing will be Rs 23.3 lakh crore and the net will be Rs 17.8 lakh crore for the next financial year. The Budget seeks to pay back Rs 3.1 lakh crore next fiscal, up from Rs 2.7 lakh crore this fiscal. With Rs 80.8 lakh crore outstanding government bonds, the RBI is the second-largest holder of them after financial institutions.

According to a report, the government securities maturing by 2061 are worth Rs 80.8 lakh crore as of the end of January. Of this, 37.8 per cent are held by banks, 24.2 per cent by insurers, which means 62 per cent of them are held by them, and the monetary authority holds as much as 17 per cent. It mentioned that as against this, the foreign ownership of G-secs are a paltry 1.9 per cent. This is the lowest among its peers as in Brazil, it is a high 44.5 per cent, 41.1 per cent in Mexico, 35 per cent in South Africa and 10.5 per cent in China. It also pointed out that had the government allowed the G-Secs inclusion into international bond indices, as widely expected, this will have seen at least Rs 1.5 lakh crore/ $15-20 billion of additional ownership by foreigners, helping the RBI manage the borrowing programme easily.