RBI to Re-issue Govt Securities Worth Rs 27,000 Crore

According to information provided by the Reserve Bank of India (RBI) earlier this week, the centre has planned the re-issue of government securities amounting to Rs 27,000. In this article, we look at all the details.

What are government securities?

Government Securities (G-Secs) are debt instruments issued by the central or state governments to borrow money from the public. In simple words:

• You lend money to the government by buying these securities.
• In return, the government promises to pay back the money after a certain time with interest.

Auction Details

The securities will be offered in two separate auctions scheduled for June 21, 2025. Below are the auction details:

• Rs 15,000 crore at 6.75% interest, maturing in 2029
• Rs 12,000 crore at 7.09% interest, maturing in 2054

The government may retain an extra Rs 2,000 crore in bookings beyond the notified amount. Earlier this month, RBI reissued Rs 32,000 crore in two longer-term bonds—one maturing in 2039 (6.92%) and another in 2065 (6.90%) - each for Rs 16,000 crore.

You can apply for these securities on e-Kuber - RBI’s electronic bidding system. These will be available in two windows:

• Non‑competitive bids: You agree to accept the yield (interest rate) the auction decides - a quick and simple process. The window for this is 10:30 to 11:00 a.m.
• Competitive bids: You specify the yield you are willing to accept. If too low, your bid might be rejected. The window for this is between 10:30 to 11:30 a.m.

The auction result will be declared on the RBI website on 20 June 2025, and the successful bidder will have to make payment on 23 June 2025 - the bond issue date.

Why Re‑Issue Bonds?

Here are a few reasons for bond re-issue:

• Manage borrowing efficiently: Governments often re-issue existing securities to tap into proven, well-known maturities and build liquidity in those bonds.
• Yield management: By re-issuing at current market rates, the government aligns its borrowing costs with investor expectations.
• Continue funding needs: This fits within the broader fiscal roadmap for FY 2025–26

Implications for Markets & Investors

• Yield benchmarks: The announced coupon rates (6.75% and 7.09%) serve as reference rates for similar bonds in the market.
• Investor sentiment: Strong bid volumes may signal demand, while a tepid response could pressure yields upward.
• Bond market stability: RBI’s selective acceptance of bids keeps yields in check, ensuring orderly liquidity and preventing volatility.

Before you go

RBI’s re-issue of Rs 27,000 crore across familiar maturities is a strategic step in India’s fiscal financing. It helps in smoothing out debt repayments, provides liquidity in liquid yield curves, and signals RBI’s intent to manage borrowing costs responsibly. Market watchers will keep an eye on the auction outcome, bond yields, and participation levels for clues on India’s macroeconomic path.