RBI has released the outline of the market borrowing calendar of ₹3.19 lakh crore for states and union territories for the July-September quarter.

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Highlights

RBI has announced a market borrowing calendar of ₹318,816 crore for states and union territories for the July-September 2026 quarter.
BIS (Benchmark Issuance Strategy) has been expanded to nine new states and one union territory, moving towards a more transparent and systematic borrowing program.
The final borrowing will be updated two to three days before the auctions, based on approval under Article 293(3) of the Indian Constitution, state requirements, and market conditions.

This article was translated from the original. Read the original version by our correspondent here.

Borrowing Calendar and BIS Expansion

According to the RBI press release, the Benchmark Issuance Strategy, or BIS, was launched on a pilot basis with nine states in the first quarter of FY 2026-27, and from the second quarter, it is being extended to nine more states and one union territory, including Delhi. Under this framework, securities are issued in specific benchmark maturity categories as per the pre-announced calendar, making the borrowing program more transparent and systematic.

RBI has prepared an indicative market borrowing calendar for the July to September 2026 quarter in consultation with 18 states and Delhi. Separate calendars have been prepared for the remaining states and union territories in consultation with their respective governments, and it is expected that they will also adopt the BIS framework in due course.

Impact on Investors and Debt Market

The total market borrowing of state governments and union territories for the quarter is estimated at ₹318,816 crore, which signals significant supply for the sub-national government borrowing market. RBI has stated that the actual borrowing amount and the details of participating states or union territories will be announced via press releases two or three days before the actual auction date.

The final borrowing program will depend on the requirements of the states and union territories, approval of the Government of India under Article 293(3) of the Indian Constitution, and prevailing market conditions. RBI also said it will aim to distribute borrowing evenly throughout the quarter and conduct auctions smoothly, taking into account market conditions and other relevant factors, although it reserves the right to change dates and amounts if needed.

Our earlier report discussed the impact of high capital costs behind the high valuations of the Indian stock market and the effect of the nearly 7% risk-free rate of the 10-year government bond. It also noted that in the global interest rate environment, foreign capital demands a higher risk premium, while domestic investors may feel pressured to achieve expected returns among limited options.

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