RBI’s Guidelines on State ‘Guarantees’ on Borrowing

On 16th January, 2024, a working group constituted by the Reserve Bank of India (RBI) made certain recommendations to address issues relating to guarantees extended by State governments.

  • The working group, constituted in July 2022, comprised of members from the Ministry of Finance, Comptroller and Auditor General of India, and some State governments.

Recommendations

Expanded Definition of Guarantee

  • The Working Group proposes a broader definition of ‘guarantee’ to encompass all instruments which create an obligation on the guarantor to pay.
  • There must not be any distinction between conditional or unconditional, financial or performance guarantees while evaluating fiscal risk.

Government ....

Do You Want to Read More?
Subscribe Now
To get access to detailed content

Already a Member? Login here

Take Annual Subscription and get the following Advantage
The annual members of the Civil Services Chronicle can read the monthly content of the magazine as well as the Chronicle magazine archives.
Readers can study all the material since 2018 of the Civil Services Chronicle monthly issue in the form of Chronicle magazine archives.
Be an Annual Subscriber

Economy Watch