India

Telangana Plans ₹13,000 Crore Borrowing in Q3 FY 2026-27

By M. Rajeev

The Telangana Government has announced plans to raise ₹13,000 crore from the open market in the third quarter of the 2026-27 financial year. The move comes as the state fears it may exceed borrowing limits set by the Union Finance Ministry with one quarter remaining. In a submission to the Reserve Bank of India, the state indicated it will raise ₹3,450 crore in October, ₹4,500 crore in November and ₹4,000 crore in December through securities auctions. These additional borrowings will bring total borrowing for the year to ₹59,400 crore, after the government has already raised ₹18,900 crore and ₹27,500 crore in the first two quarters. The proposed amount remains within limits, as the state will stay below its net borrowing cap after the third quarter. For FY 2026-27, the government has proposed gross borrowings of ₹79,984 crore, including open market loans and central assistance for capital expenditure. Of this, ₹23,025 crore is earmarked for repayment of principal and interest, leaving a net borrowing limit of ₹56,959 crore. By the end of July, the state had raised ₹32,400 crore in gross borrowings, with net borrowings of ₹22,900 crore, indicating room for additional borrowing in the last quarter if the indent is followed. Finance experts say the difference will be used to repay older loans, a practice described as “ever greening” of loans, similar to farmers taking new loans each year to cover outstanding dues. "The outstanding amount will continue to remain as the process involves book adjustments," an expert noted. Published - October 06, 2026 03:31 pm IST