Sovereign foreign borrowing is a bold move
New Delhi, July 12 -- The finance minister, Nirmala Sitharaman's proposal that the Government of India borrow in foreign currency is a bold move. To reap the benefits of foreign sovereign borrowing, fiscal discipline is an essential prerequisite. If markets suspect errors in budget estimates, off-budget borrowing, or delayed payments to achieve annual fiscal targets, it can make foreign markets mistrust the government of India and raise the cost of borrowing. While India has a Fiscal Responsibility and Budget Management (FRBM) Act and an inflation targeting monetary policy in place, it needs greater fiscal transparency....
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