Several state governments, including Assam, Bihar, and Rajasthan, will auction securities worth ₹22,200 crore via re-issuance of existing stock, primarily through price-based auctions.
States to Raise ₹22,200 Crore Through G-Sec Auctions
Auction of state government securities worth ₹22,200 crore (face value) has been announced by multiple state governments. The issuances are re-issues of existing securities, including Assam’s 7.83% bond maturing in 2046. The auctions will be conducted through price-based bidding, consistent with standard market practice for re-issued securities.
Participating states include Assam (₹800 crore), Bihar, and Rajasthan, among others. These borrowings are part of the states’ market loan programs approved under the overall fiscal deficit ceiling set by the Ministry of Finance. The RBI facilitates these auctions as part of the Uniform Market Auction (UMA) process.
The auctions provide investors with exposure to state-specific credit risk while offering slightly higher yields than central government securities. Legal and financial practitioners should note the credit standing and fiscal health of issuing states when advising on such instruments, particularly in the context of infrastructure and public project financing.
