Most often we hear of the government debt rising during higher toned debates on the TV news channels. Some say it is because of the freebies offered to the public. Others try to maintain that the governments both at the centre and the states mobilised more debt to basically facilitate a sustainability to unmistakably economic activities.
According to the news, our great country’s general government debt climbed to around 88% in the Financial Year 2021. It has been brought down to around 81% in the Financial Year 2023 as the Centre and states rolled out fiscal consolidation plans.
Reportedly, the Centre’s debt to GDP rose from around 49% in Financial Year 2019 to 61.5% in FY 2021, before reconciling to 57% in FY2023.
One rating agency has projected India’s general government debt to stabilize at around 80% of GDP over the next two to three years, lower than the peak in FY2021 but higher than many similarly-rated sovereigns.
Although our finance minister attempts to use some very well-streamlined ways to meet India’s aspirational prerequisites that are supposedly there but what she stands to suggest there is strong need to deal it with a sense of binding responsibility. Why so? Because the new generations do not bother to realise of the unnecessary burden that the government has left before them.
The Centre’s fiscal deficit enlarged to 9.2% in the FY2021 as revenues were relatively down. However, the fiscal deficit was brought down to 6.7% in FY2022, 6.4% in FY2023 and expected to be brought down to 5.9% in FY2024. The medium-term target is to bring it down to 4.5% by FY2026, as has been reported.