On October 16, 2026, several state governments, including Andhra Pradesh and others, announced auctions to raise ₹24,400 crore through the re-issue of State Government Securities (SGS), with price-based and yield-based bidding methods.
State Government Securities Auction
On October 16, 2026, multiple state governments announced auctions to raise ₹24,400 crore through the issuance of State Government Securities (SGS). The participating states include Andhra Pradesh, which proposed to re-issue ₹1,000 crore of its 7.68% SGS 2051 security via a price-based auction.
These auctions are conducted through the Reserve Bank of India and form part of state-level market borrowing programs. The tenors vary, with Andhra Pradesh's offering extending to 2051. Price-based auctions are typically used for re-issuance of existing securities, ensuring liquidity and price discovery in the secondary market.
Market and Fiscal Implications
State government borrowings are backed by the Consolidated Fund of the respective state and are exempt from tax under Section 10(15)(iv)(h) of the Income-tax Act, 1961. Rising issuance volumes may impact yield curves and require careful monitoring by debt managers. Investors should assess credit risk, tenor, and prepayment risks in state-specific securities.