While Finance Minister Pranab Mukherjee presented the Union Budget, the market gasped when it was announced that the country’s fiscal deficit stood at 6.8% and that the government may need to borrow about Rs 4 lakh crore, resulting in the expectations that bond yields may harden ahead and interest rates may shoot up. However, in an exclusive interview, R Sridharan, Managing Director of State Bank of “In the initial stages, the yields might see a small spike but in the medium term, I feel that this borrowing programme can be managed by both the government and the RBI without dramatic downturn in the credit availability or also massive spike in interest rates,” Sridharan said. |
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