(ET)
The government is seeking to raise up to Rs 10,000 crore in its maiden tax-free bond issue to help bridge the fiscal gap, which is set to widen in the aftermath of Covid-19-induced economic disruptions and low tax collections. The finance ministry has begun negotiations with bankers on a likely tax-free bond issue. The money may be raised in multiple instalments, people aware of the plan. “We are in talks with bankers and other resources regarding the launch of such an issue,” said one of them.
The government plans to raise temporary funds from the central bank through ways and means advances (WMA), a short-term borrowing window. However, this may not be sufficient to meet anticipated immediate expenses, said the people cited above.
