The government may wait till December to decide on additional borrowing for the current fiscal, senior government officials told CNBC-TV18.

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The government has room to borrow Rs 12 lakh crore for the whole of this fiscal.

"The aim is to exhaust the limit first and then take a decision (on additional borrowing), ” one senior official said.

The total gap in government revenues and expenditure as of July end is Rs 8.21 lakh crore, and so the government does not feel the need to announce additional borrowing just yet, the official said.

On the likely quantum of additional borrowing, another senior official said, “It’s yet to be decided, we will have clarity may be closer to December ”.

By then, the government would have a clearer picture of tax collections. Also, the second quarter GDP figure will be announced on November 30.

“If need be, the additional borrowing would be done only for 1 or 2 months,” the official said, adding that signs of a pick up in the economy were visible.

"The latest GST collections show only an 11 percent shortfall year-on-year. We expect GST collections to pick up in September,” the official said.

In May this year, the government had announced an additional borrowing of Rs 4.20 lakh crore for FY21 as a countermeasure to minimise the pandemic's impact on the economy. This raised the total borrowing for the fiscal to Rs 12 lakh crore.

Importantly, it is not just the rise in COVID cases, but also the Indo-China border situation that the government is watching closely. These are factors that the government will have to weigh while deciding on its spending and borrowing plan.

"Apart from the rise in COVID cases, we need to watch Indo-China border tension closely,” the official quoted above said.

The finance ministry and the RBI will meet this month end to decide the issuance calendar for second half (H2) borrowing.