As against the budget estimates (BE) for 2020-21, the government announced a raise in its estimated market borrowing from Rs. 7.8 lakh crore to Rs. 12 lakh crore. Giving the rationale, the government iterates that the Covid 19 pandemic has necessitated upward revision in borrowings.
Gross market borrowing is the government's borrowing from the market when its revenues from tax and other sources fail to meet its expenses.
Also, for the remainder of H1FY21, a modification has been made in the gilt issuance calendar as part of which the government will borrow Rs. 6 lakh crore from the market via gilt in the remaining part of H1FY21.
This clearly provides for the intent that the RBI is not lending directly to the government.
"There are clear signs of government finances being affected by the shutdown as revenue has ebbed and expenditure pressure will be there through the year even after the lockdown is withdrawn," CARE Rating said in a note.