Fiscal sustainability refers to a government's ability to meet its long-term expenditure commitments without excessive borrowing or causing financial instability. It ensures that debt remains at a manageable level relative to economic growth. To achieve this, policymakers must implement a mix of revenue-enhancing measures, expenditure controls, and structural reforms that balance economic growth with financial discipline. India's fiscal deficit and public debt have been critical concerns in economic policy making. While fiscal spending is essential for development, high deficits and rising debt pose risks to macroeconomic stability. This paper examines trends in India's fiscal deficit and public debt, analyses the risks associated with increasing government borrowing, and explores the sustainability of current debt levels. It also discusses policy measures to ensure long-term fiscal stability.
Dighe et al. (Tue,) studied this question.
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