India’s Public Debt
As per Moody’s Investors Service, India’s public debt level is among the highest in emerging economies with a quantitative easing programme underway, while its debt affordability is among the weakest.
Important points from Moody's analysis
- With the exception of Chile, most of the 11 emerging markets have weak government effectiveness, suggesting potential risks executing fiscal reforms or consolidation plans.
- Debt affordability varies widely, with Ghana and India [rated Baa3 negative] weakest.
- Across the 11 emerging markets, India, South Africa and Ghana have the highest public debt and weakest debt affordability.
- “Most economies’ debt burdens will rise before they stabilise overthe next few years.
- Depending on recovery prospects and future debt servicing costs, high debt levels may become unsustainable for the more vulnerable economies,”
What is Public Debt?
- Public debt is the total amount borrowed by the government of a country.
- Public debt includes the total liabilities of the Union government that have to be paid from the Consolidated Fund of India.
Source : the Hindu