Govt to Raise ₹36,000 Crore: Two Bond Re-Issues Announced Ahead of July 25 Auction

Government to Raise ₹36,000 Crore via Bond Auction

The Government of India has announced the re-issue of two dated bond securities to raise ₹36,000 crore through a public auction. The Reserve Bank of India (RBI) will conduct the auction on July 25, 2025, through its electronic platform, e-Kuber, at its Mumbai office. The move aims to meet the government’s growing fiscal needs while offering safe investment options to the public.

Details of the Two Securities

The first re-issued security is the 5.91% Government Security (GS) 2028, which will mature on June 30, 2028. This will raise ₹6,000 crore. The second and much larger offering is the 6.33% GS 2035, maturing on May 5, 2035, with a notified amount of ₹30,000 crore.

To encourage higher participation, the government has also provided the option to retain an extra ₹2,000 crore for each security if the investor demand exceeds expectations. This brings the potential total to ₹40,000 crore, depending on market appetite.

Why Government Issues Bonds

When government spending surpasses its income from taxes and other revenues, it results in a fiscal deficit. To bridge this gap without increasing taxes immediately, the government borrows by issuing bonds. These government securities are considered safe and offer a fixed return to investors. The money raised helps fund infrastructure projects, welfare schemes, subsidies, salaries, and other essential programs.

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Auction and Investor Participation

The RBI will use the multiple price method to determine winning bids. The results will be declared on the same day, and successful bidders must make payment by July 28, 2025. A minimum bid of ₹10,000 is required, and bids must be in multiples of ₹10,000 thereafter.

The bonds will also be available for “When Issued” trading from July 22 to July 25. Retail investors can participate via the RBI Retail Direct platform, while non-residents can invest under the Fully Accessible Route (FAR).

This strategic fund-raising exercise allows the government to manage its fiscal responsibilities efficiently while offering investors a secure and stable opportunity.