FM Sitharaman Warns Against Unsustainable Debt
Finance Minister Nirmala Sitharaman has emphasized the importance of maintaining fiscal discipline to ensure that future generations are not burdened with unsustainable debt. Speaking at a conference, the Finance Minister highlighted the need for responsible economic policies, particularly in the context of global challenges such as inflation, economic uncertainty, and evolving market dynamics.
The Finance Minister reiterated the government’s commitment to achieving a balance between economic growth and fiscal responsibility. “It is imperative that we do not over-leverage ourselves in the pursuit of short-term growth at the cost of long-term stability,” she said.
Balancing Growth and Sustainability
Sitharaman highlighted that while capital investments and social welfare expenditures are necessary to propel economic growth, they must be complemented by prudent fiscal management. The government, she noted, has been focusing on targeted spending to create infrastructure and jobs while keeping inflation in check.
The Finance Minister also pointed out that India’s economic resilience has been evident during global headwinds, but sustained efforts are needed to avoid falling into the debt trap seen in some other economies.
India’s Fiscal Roadmap
In the upcoming Budget 2024-25, Sitharaman hinted that the government would prioritize fiscal consolidation alongside measures to boost investments and domestic consumption. The Centre has already committed to reducing the fiscal deficit to below 4.5% of GDP by 2025-26, ensuring that growth remains sustainable and inclusive.
Experts have also cautioned that rising public debt, if unchecked, could lead to reduced creditworthiness and limited fiscal flexibility. The government’s focus on maintaining fiscal discipline is expected to resonate positively with global investors, bolstering India’s image as a stable and reliable market.
The Finance Minister concluded by stating that fiscal prudence is not just about balancing books but ensuring that the nation’s future generations inherit a sustainable and thriving economy. As the Budget session approaches, this principle is likely to guide key policy announcements.
