Financial Minister says that the overall liabilities of the Center will increase to Rs 155 lakh crore in FY23
Liabilities for the Centre are anticipated to rise from 58.7% of GDP in FY22 to 60.2 percent in FY23.
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In a written response to a question in the Lok Sabha on July 25, Minister of State for Finance Pankaj Chaudhary stated that the total liabilities of the Central government are anticipated to increase to Rs 155.33 lakh crore in FY23.
This would be a rise of Rs 138.88 lakh crore or 12% from the FY22 total.
In FY23, the Center plans to issue bonds to raise a record-breaking gross borrowing amount from the market of Rs 14.95 lakh crore.
In response, Chaudhary stated that the risk profile of the government's debt "stands out as safe and sensible in terms of recognised standards of indicator based approach for debt sustainability."
"Approximately 95% of the government debt is held in home currency. Multilateral and bilateral organisations provide financing for outstanding external debt at subsidised rates, "said the minister.
It's interesting to note that in FY23, the Center's liabilities are projected to rise to 60.2% of GDP.
The Center's liabilities had decreased to 58.7 percent of GDP in FY22 as the economy recovered after rising to 61.6 percent of GDP in FY21 as a result of the coronavirus outbreak.
Not just rating agencies but even technocrats have frequently pointed to India's public debt as a major economic problem. India's state finances "remain a credit vulnerability," according to Fitch Ratings, even as it altered the outlook on India's rating from negative to stable in June of this year.
The Center will issue bonds this year to raise a record amount of money from the markets to pay for its expenses. A budget deficit of 6.4% of GDP has been set as the goal.
In FY22, the budget deficit was 6.7% of GDP, which was 20 basis points less than the original target of 6.9%.
The cumulative liabilities of the central and state governments in FY22 were Rs 195.49 lakh crore, or 82.6 percent of GDP, according to Chaudhary in response to a different query.
The potential increase in liabilities for state governments in FY23 was not anticipated.
