India's central government debt is on track to reach Rs.185.27 trillion, or 56.8% of GDP, by the financial year 2024-25 (FY25), according to Minister of State for Finance Pankaj Chaudhary's recent statement in the Lok Sabha. This marks a significant increase from Rs.93.26 trillion, or 49.3% of GDP, recorded in 2018-19.

This anticipated rise in debt follows a trend of increasing national debt over the past six years, reflecting a mix of fiscal challenges and evolving economic policies. The government's growing expenditure on public services, infrastructure projects, and economic stimulus measures contributes to this upward trajectory.

In FY20, the debt climbed to Rs.105.07 trillion, equivalent to 52.3% of GDP. Chaudhary noted this increase was largely due to heightened spending on infrastructure and social schemes aimed at boosting economic growth. The onset of the COVID-19 pandemic further exacerbated the situation, pushing the debt to Rs.121.86 trillion, or 61.4% of GDP, in FY21. The government had to rely on extensive borrowing to fund relief measures and economic stimulus packages during this period.

As the country began to recover from the pandemic, debt continued to rise, reaching Rs.138.66 trillion, or 58.8% of GDP, in FY22. Although there was a slight improvement in the debt-to-GDP ratio due to a rebound in economic activity, the total debt amount continued to increase. By the financial year 2022-23, debt further surged to Rs.156.13 trillion, or 57.9% of GDP, driven by ongoing investments in economic recovery, infrastructure development, and welfare programs.

Provisional figures for FY24 show that debt has risen to Rs.171.78 trillion, or 58.2% of GDP. This reflects ongoing efforts to stabilize the economy and invest in growth-oriented projects. Looking ahead, budget estimates for FY25 predict the debt will reach Rs.185.27 trillion, or 56.8% of GDP, in line with the government's strategy to maintain economic growth while managing fiscal deficits.

According to the International Monetary Fund’s World Economic Outlook for April 2024, India's GDP was $3.57 trillion in 2023-24, highlighting the country's growing significance in the global economy.

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