What Happened
On March 27, 2026, the Reserve Bank of India conducted an auction of State Development Loans (SDLs) on behalf of 13 Indian states. The total amount notified for the auction stood at ₹42,941 crore, and the total amount accepted came in at approximately ₹39,992 crore. Two states, Assam and Gujarat, did not accept any bids in their respective securities, while several others accepted partial amounts.
This press release (No. 2025-2026/2331) was issued by Ajit Prasad, Deputy General Manager (Communications) at the RBI.
State by State Auction Results
Andhra Pradesh
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 14 | 1,000 | 1,000 | 7.99 | | 16 | 1,000 | 1,000 | 8.02 | | 18 | 1,400 | 1,400 | 8.00 |
Andhra Pradesh fully accepted all three tranches totaling ₹3,400 crore.
Assam
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 10 | 500 | Nil | Not applicable |
Assam did not accept any amount in the 10 year security.
Gujarat
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 09 | 1,000 | Nil | Not applicable |
Gujarat did not accept any amount in the 09 year security.
Haryana
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 05 | 1,000 | 1,000 | 7.38 | | 15 | 1,500 | 1,500 | 7.88 | | 18 | 1,500 | 1,500 | 7.99 |
Haryana fully accepted all three tranches totaling ₹4,000 crore. The 5 year tranche at 7.38% was the lowest yield in the entire auction.
Kerala
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 15 | 1,000 | 1,000 | 7.92 | | 20 | 750 | 750 | 8.04 |
Kerala fully accepted both tranches totaling ₹1,750 crore.
Madhya Pradesh
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 14 | 1,500 | 1,500 | 7.82 | | 24 | 1,000 | 1,000 | 8.09 |
Madhya Pradesh fully accepted both tranches totaling ₹2,500 crore.
Nagaland
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 15 | 350 | 350 | 8.00 |
Nagaland fully accepted its single tranche of ₹350 crore.
Rajasthan
| Security | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Price (₹) / Yield (%) | |---|---|---|---| | Re issue of 7.54% Rajasthan SGS 2035 (issued December 24, 2025) | 1,000 | 1,000 | 98.76 / 7.7209 | | 12 year | 1,230 | 1,230 | 7.87 | | 15 year | 1,000 | 1,000 | 7.99 |
Rajasthan fully accepted all three tranches totaling ₹3,230 crore.
Tamil Nadu
| Security | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Price (₹) / Yield (%) | |---|---|---|---| | Re issue of 6.92% Tamil Nadu SGS 2030 (issued January 07, 2026) | 1,000 | 1,000 | 98.43 / 7.4001 | | Re issue of 7.31% Tamil Nadu SGS 2033 (issued January 21, 2026) | 1,500 | 1,500 | 98.36 / 7.6201 | | Re issue of 7.18% Tamil Nadu SGS 2035 (issued March 12, 2025) | 2,000 | 2,000 | 96.67 / 7.7008 | | Re issue of 7.58% Tamil Nadu SGS 2037 (issued February 11, 2026) | 1,500 | 1,500 | 98.60 / 7.7712 | | Re issue of 7.52% Tamil Nadu SGS 2055 (issued December 03, 2025) | 1,715 | 1,485.866 | 94.89 / 7.9702 |
Tamil Nadu accepted partial amount of ₹1,485.866 crore in the re issue of 7.52% Tamil Nadu SGS 2055. Total accepted came to approximately ₹7,486 crore.
Tripura
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 17 | 550 | 550 | 8.07 | | 20 | 550 | 550 | 8.00 | | 22 | 550 | 550 | 8.04 |
Tripura fully accepted all three tranches totaling ₹1,650 crore.
Uttar Pradesh
| Security | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Price (₹) / Yield (%) | |---|---|---|---| | Re issue of 7.67% UP SGS 2041 (issued February 18, 2026) | 1,200 | 1,200 | 98.51 / 7.8399 | | Re issue of 7.72% UP SGS 2044 (issued March 18, 2026) | 1,500 | 1,500 | 97.45 / 7.9893 | | 25 year | 1,500 | 1,500 | 8.09 | | 30 year | 1,146 | 1,040.047 | 8.09 |
Uttar Pradesh accepted partial amount of ₹1,040.047 crore in the 30 year security. Total accepted came to approximately ₹5,240 crore.
Uttarakhand
| Tenor (Years) | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Yield (%) | |---|---|---|---| | 09 | 500 | 500 | 7.70 | | 18 | 1,000 | 613.991 | 7.99 |
Uttarakhand accepted partial amount of ₹613.991 crore in the 18 year security. Total accepted came to approximately ₹1,114 crore.
West Bengal
| Security | Amount Notified (₹ Crore) | Amount Accepted (₹ Crore) | Cut off Price (₹) / Yield (%) | |---|---|---|---| | Re issue of 7.58% West Bengal SGS 2042 (issued December 31, 2025) | 2,000 | 2,000 | 95.79 / 8.0398 | | Re issue of 7.57% West Bengal SGS 2046 (issued December 31, 2025) | 2,000 | 1,602.037 | 95.28 / 8.0394 | | 23 year | 2,000 | 1,670.017 | 8.06 | | 26 year | 2,000 | 2,000 | 8.04 | | 30 year | 2,000 | 2,000 | 8.04 |
West Bengal accepted partial amount of ₹1,602.037 crore in the re issue of 7.57% West Bengal SGS 2046 and ₹1,670.017 crore in the 23 year security. Total accepted came to approximately ₹9,272 crore, making West Bengal the largest borrower in this auction.
Key Takeaways from the Auction
Yield Range
Yields across this auction ranged from 7.38% (Haryana, 5 year) to 8.09% (Madhya Pradesh 24 year, Uttar Pradesh 25 year and 30 year). This spread of roughly 71 basis points reflects the market's pricing of tenor risk and, to some extent, perceived credit quality differences among states.
Demand Dynamics
Out of ₹42,941 crore notified, approximately ₹39,992 crore was accepted. The shortfall of nearly ₹2,949 crore came from:
- Assam rejecting all bids for its ₹500 crore 10 year security
- Gujarat rejecting all bids for its ₹1,000 crore 09 year security
- Tamil Nadu accepting ₹1,485.866 crore against ₹1,715 crore notified for the 2055 maturity
- Uttar Pradesh accepting ₹1,040.047 crore against ₹1,146 crore notified for the 30 year security
- Uttarakhand accepting ₹613.991 crore against ₹1,000 crore notified for the 18 year security
- West Bengal accepting partial amounts in the 2046 re issue and the 23 year security
Re issues Were Popular
Several states opted for re issues of existing securities rather than fresh issuances. Re issues help build liquidity in existing bonds, which benefits secondary market trading. Rajasthan, Tamil Nadu, Uttar Pradesh, and West Bengal all tapped previously issued securities.
Why NRIs Should Care About State Development Loans
Direct Investment Angle
NRIs holding NRO or NRE accounts in India can invest in government securities, including SDLs, through the RBI Retail Direct scheme or through mutual funds and insurance products that hold these bonds. SDLs typically offer a yield premium of 25 to 75 basis points over central government securities of similar maturity, making them attractive for fixed income portfolios.
Mutual Fund and Debt Fund Impact
Many Indian debt mutual funds, including gilt funds, dynamic bond funds, and credit risk funds, hold SDLs as part of their portfolios. The yields at which these auctions clear directly affect the NAV and future returns of these funds. NRIs invested in Indian debt mutual funds should track SDL auction trends to understand portfolio positioning.
State Fiscal Health Indicator
SDL auctions serve as a real time barometer of state government fiscal health and market confidence. When a state like Gujarat or Assam rejects all bids, it may indicate that the state has comfortable cash balances and does not want to borrow at prevailing rates. Conversely, states that borrow heavily at higher yields may be under fiscal pressure. This matters for NRIs evaluating investments in state specific infrastructure projects, municipal bonds, or companies heavily dependent on state government contracts.
Interest Rate Signal
The yield curve formed by SDL auctions across different tenors provides a market based signal about future interest rate expectations. Yields in the 7.38% to 8.09% range across 5 to 30 year tenors suggest the market expects rates to remain relatively stable in the medium term. NRIs planning to take home loans in India, invest in fixed deposits, or allocate to debt instruments should factor these signals into their decisions.
FEMA Considerations for NRI Debt Investments
While this press release falls under the FEMA (Foreign Exchange Management Act) category, NRIs should note that investments in government securities, including SDLs, are governed by specific FEMA regulations. NRIs can invest in government securities on a repatriation basis through NRE accounts or on a non repatriation basis through NRO accounts, subject to applicable RBI guidelines. The RBI Retail Direct scheme allows eligible NRIs to open gilt accounts and participate in primary auctions. Always verify your eligibility and any investment limits as per the latest RBI notifications before participating.
Bottom Line
This SDL auction saw strong participation with 13 states collectively raising nearly ₹40,000 crore. The yield range of 7.38% to 8.09% across various tenors gives NRI investors a useful benchmark for evaluating Indian fixed income opportunities. States like Tamil Nadu and West Bengal were the heaviest borrowers, while Gujarat and Assam chose to stay away from the market at prevailing rates. For NRIs building or rebalancing their India fixed income allocation, these auction results offer valuable data points on state credit quality, market liquidity, and interest rate direction.