New Delhi, Sep 12 (IANS): Government Thursday said that it will enter into a arrangement with International Bank for Reconstruction and Development (IBRD) for investing in special bonds that will, in turn, raise the country's borrowing limit by $4.3 billion.

The decision which was approved by the Cabinet Committee on Economic Affairs (CCEA) for entering into the special private placement bonds (SPPBs) arrangement with IBRD will enable India to have additional borrowing of $4.3 billion.

Currently, India through single borrower limit (SBL) can borrow $17.5 billion. This amount will now increase to $21.8 billion

According to the CCEA, a framework agreement between government and IBRD would be signed.

The decision envisages Reserve Bank of India (RBI) to invest in the SPPBs of the IBRD.

"Additional borrowing space will enable government to commit new projects with IBRD assistance," the CCEA said in a statement.

"Government of India gives preference to projects in low income and special category States, as well as to projects aimed at fostering inclusive growth."