India is on track to reduce its government debt to 50% of GDP by 2030, Finance Minister Nirmala Sitharaman said, while emphasising that fiscal consolidation will continue without compromising spending on social welfare.
Addressing the Indian diaspora in Chicago on Saturday, Sitharaman said the government had set a clear target of bringing borrowing down to the 50% of GDP level by 2030.
“We have set ourselves a certain target, which is to bring the borrowing down to the 50% level of GDP by 2030. Therefore, I will be working on that path,” she said.
The Finance Minister said the government had also achieved the final milestone in its fiscal deficit consolidation roadmap for 2025-26, reflecting its continued focus on prudent fiscal management.
Sitharaman also pointed to India’s improving credit ratings as evidence of stronger economic management, stressing that fiscal discipline had not been achieved by reducing social welfare expenditure.
“Our credit ratings are improving. But that’s not by cutting corners. That’s not by stopping the resources which have to go for social welfare. It is through proper management of the economy,” she said.
Focus on Viksit Bharat 2047
Sitharaman said India’s next major objective was to become a developed economy by 2047 under the Viksit Bharat vision. With less than two decades remaining to achieve the goal, she called for greater participation from the Indian diaspora, particularly in the form of talent, expertise, ideas and capital.
“The speed and scale with which the reforms are happening require a lot more support,” she said, urging overseas Indians to contribute to the country’s development journey.
India Navigates Global Supply Disruptions
The Finance Minister also highlighted the government’s response to global supply-chain disruptions, including shortages of crude oil, LPG and fertilisers.
She said India was able to avoid a major fertiliser shortage by consistently communicating its requirements to global markets even as international supplies tightened.
The situation was further complicated by growing risks in international shipping. Ships carrying essential commodities faced difficulties in securing adequate insurance coverage, while risk premiums rose sharply.
To address the issue, the government established a fund announced in the Union Budget to support the additional insurance premiums incurred by shipping companies because of heightened geopolitical and maritime risks.
“As a result, Indian farmers, Indian households and Indian logistics did not suffer,” Sitharaman said.
She added that the government’s ability to closely monitor global developments while assessing domestic requirements had helped India maintain economic resilience despite a challenging external environment.
“Many countries have seen their calculations go haywire amid these uncertainties. Thankfully, despite our limitations, we have kept our citizens protected in this challenging environment,” she said.