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 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. 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 a type of government debt that will be spent on financing projects related to helping India transition to a low carbon economy. In addition, the government has also retained the right to exercise the green shoe option. Which will allow it to accept additional subscriptions of up to Rs 2,000 crore against each security mentioned in the auction notifications. This flexibility will enable the government to meet additional demand from investors.
The weekly borrowing of the central government through treasury bills during the third quarter (October-December) of FY25 is expected to be Rs 19,000 crore for 13 weeks. In addition, to address temporary discrepancies in government accounts, the Reserve Bank of India (RBI) has also set the limit of Ways and Means Advances (WMA) for H2 FY25 at Rs 50,000 crore. This will ensure adequate liquidity to meet short-term financing requirements.
