Reserve Bank of India Announces Auction of State Government Securities Worth ₹14,500 Crore
The Reserve Bank of India will conduct an auction of State Government Securities (SGS) for seven states on April 28, 2026, targeting an aggregate amount of ₹14,500 crore. Participating states include Uttar Pradesh, Kerala, and Madhya Pradesh, with tenors ranging from 3 to 23 years. The auction will be held through the E-Kuber system, featuring both competitive and non-competitive bidding facilities for individual and institutional investors.
Key Facts
- RBI / Total Auction Amount : ₹14,500 crore
- Auction Date / Schedule : April 28, 2026
- Participating States / Count : 7 States
- System Used / Platform : E-Kuber
- Investment Class / Status : SLR eligible
The Reserve Bank of India (RBI) scheduled a significant market borrowing exercise for seven state governments on April 28, 2026. This auction involves the sale of 'State Development Loans' (SDLs) to raise capital for state-level expenditure. Uttar Pradesh is the largest borrower in this round, seeking to raise ₹4,500 crore, followed by Kerala with ₹1,800 crore. The auction process utilizes the RBI’s Core Banking Solution, E-Kuber, which allows for seamless electronic bidding. Tenors for the securities vary significantly, with Uttarakhand offering a 3-year short-term yield while Kerala is issuing long-term 23-year bonds.
This auction is essential for maintaining state liquidity and funding infrastructure projects. From an investment perspective, State Government Stocks are reckoned as eligible investments for banks to maintain their Statutory Liquidity Ratio (SLR) under Section 24 of the Banking Regulation Act, 1949. They also qualify for the 'ready forward' facility, providing banks with collateral for short-term borrowing. The inclusion of a non-competitive bidding facility for retail investors via the Retail Direct portal highlights the government's ongoing effort to democratize ownership of government debt and deepen the bond market.
| State | Amount (₹ Crore) | Tenor (Years) |
|---|---|---|
| Uttar Pradesh | 4,500 | 10 & 20 (Re-issue) |
| Kerala | 1,800 | 23 |
| Madhya Pradesh | 2,800 | 8 & 22 |
| Bihar | 2,400 | 9 & 20 (Re-issue) |
Glossary
E-Kuber: The Core Banking Solution of the RBI that provides a platform for government securities auctions and other banking operations.
Statutory Liquidity Ratio (SLR): The minimum percentage of deposits that a commercial bank has to maintain in the form of liquid cash, gold, or other securities approved by the RBI.
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