Budget's fiscal consolidation roadmap to stabilise debt burden: Moody's

Debt overhang offsets country's growth potential, says rating agency

India’s Budget for 2023-24 keeps fiscal consolidation intact and will help stabilise the government’s debt burden relative to nominal Gross Domestic Product (GDP), said Moody’s on Wednesday.

The global rating agency, however, flagged risks of debt overhang. High debt burden and weak debt affordability could offset India’s fundamental strengths of high growth potential and deep domestic capital markets,

Finance Minister Nirmala Sithraman, in her Budget speech, said the government has stuck to a fiscal deficit estimate of 6.4 per cent of GDP for 2022-23. For FY24, the fiscal deficit is estimated to be 5.9 per cent of GDP.

The government