Another borrowing binge

Governments borrowing more than what they promise in their budgets is an old story in India. Supplementary demands for grants and borrowing calendars going askew are something that markets take in their stride. So when the bond market reacted adversely to the Union government’s surprise announcement on Thursday that it planned to borrow Rs53,000 crore more this year—roughly 0.6% of the gross domestic product (GDP)—it was something “normal”. Not normal are the contradictions in macroeconomic management that have been visible for a while now.

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