Singh will recommend different debt glide paths for each state to reduce overall debt-to-GDP ratio of states to 20% by 2024-25 instead of a similar glide path for each state. Singh committee on fiscal discipline had favoured a combined debt-to-GDP ratio of 60% by 2022-23—40% for the central government and 20% for state governments. “I see no great difficulty for the central government to bring down its debt-to-GDP ratio of 40% by 2024-25," Singh said. The budget targets to reduce debt-to-GDP ratio from 48.9% in 2018-19 to 47.3 in 2019-20 and 43.4% by 2021-22. To be sure, the calculations of gross debt by IMF and the central government differ, particularly regarding accounting of divestment and licence auction proceeds and some public sector lending.

Source: Mint May 17, 2019 15:00 UTC