The Indian government plans next week to announce lower than expected borrowing needs for the second half of the fiscal year ending in March, said four people briefed on the matter, in a move that could remove some nervousness in the bond market.

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Senior Indian government officials met with a select group of market participants earlier this week and assured them that the bond market borrowing programme for October to March would be lower than expected, said the sources directly aware of the matter, who asked not to be named as the discussions were private.

The meeting was called to get feedback on the current volatility in bond and currency markets, as well as assure the market players about the government's intention to stick to its fiscal deficit and borrowing targets, the sources said.

"It was very clearly communicated that the government is sensitive to market apprehensions and will steer away from any negative or populist steps," said one official. "There won't be any rise in the borrowing program, there can only be a reduction if any," he said.