Govt debt stabilises in the last few years: Report

The Dollar Business Bureau 

Owing to the fiscal consolidation process at the central and state government level, the general debt-to-GDP ratio has been recorded at 68.6% at the end of March this year, which is significantly below than the historical high of 83.3% in 2003-04, said the Finance Ministry in a report. 

The Central Government has been publishing a number of documents to provide details on the country’s total debt position, consolidated data with regards to public debt, and strategies of Central Government Debt for debt management, among others.

“It has now been decided to consolidate all these publications into 'Status Paper on Government Debt' report to bring complete Government Debt and its Management related information at one place,” the Ministry said. 

The Consolidated Status Paper on Government Debt for this year said that the total liabilities of the Government of India as percentage of GDP have steadied in the last few years after recording a consistent drop since 2001-02. 

According to the paper, 93.8% of overall government debt at the end of March is denominated in Indian currency. 

External debt, as the percentage of GDP, constituted a low of 3% at March-end 2016, indicating low risk of currency to the government debt portfolio while its effect on balance of payments continues to be insignificant.

The limited external debt is from official sources, offering safety from the volatility of the international financial markets the report revealed. 

With regards to the debt strategy for 2016-17 to 2018-19, the report stated, “it is assumed that economy will record moderate to reasonable growth, a moderation in inflation as per the path projected by the Reserve Bank and financial stability.”