IMF warns India about growing debt

The IMF has warned India about its mounting debt, stating that it could eventually equal its GDP.

What is the reason behind India's rising debt levels?

• The primary cause of India's growing debt is the country's fiscal deficit
• Payment of interest
• Social welfare programs
• Depreciation of currency
• Global Dependencies

The primary cause of India's growing debt is the country's fiscal deficit

Simply because government revenue is less than expenditure, debt is required to make up the difference.

India has had a trade deficit for a long time because its exports are lower than its imports.

Payment of interest

In accordance with India's 2023 budget, we will pay twenty rupees in interest if our total expenditure is one rupee.

Social welfare programs

The government must provide funds for social welfare and other initiatives that serve the public interest, such as public subsidies and corporate incentives.

Election parties have been known for many years to offer freebies to the public in exchange for votes.

Depreciation of currency

Currency depreciation may be the cause of rising international trade costs for goods and services, as well as high debt repayment costs.

Global Dependencies

One reason is that if your country is not capable of manufacturing goods and services that your population consumes, then a country has to go to another country, which affects its debt level, like the purchase of defense equipment, medicine, technology, mobile phones, etc.