RBI: Tamil Nadu tops market borrowings among States

According to data from the Reserve Bank of India (RBI), Tamil Nadu has raised ₹30,500 crores in the fiscal 2020-21 and has topped market borrowings among States in the country. Tamil Nadu, which has accounted for 17% of the borrowings done through the issue of bonds (known as state development loans), has been followed by Maharashtra ₹25,500 crores (14%), Andhra Pradesh ₹17,000 crores (9%) and Rajasthan ₹17,000 crores (9%).

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Tamil Nadu borrowings:

  • Tamil Nadu raised ₹1,250 crores at the low-interest rate of 6.63% for the 35-year bonds and ₹1,250 crores at the rate of 4.54% for the three-year bonds in the auction conducted by RBI.
  • On July 7, Tamil Nadu borrowed an additional amount of ₹500 crores rather than the ₹2,000 crores originally planned.
  • The State had planned to raise ₹2,000 crores through the issue of bonds of ₹1,000 each with tenures of 35 years and 3 years respectively.
  • Tamil Nadu had an option to raise a further ₹250 crore in each of these securities, through what is known as the ‘greenshoe’ option.

Important takeaways for all competitive exams:

  • Governor of Tamil Nadu: Banwarilal Purohit.
  • Tamil Nadu Chief Minister: K. Palaniswami.

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