Question
The Central Government's outstanding liabilities are estimated at 55.6% of GDP for FY27. What is the target debt-to-GDP ratio recommended for the Central Government by the latest fiscal consolidation path by March 2031?
Solution
The Central Government follows a medium-term fiscal consolidation roadmap guided by the Fiscal Responsibility and Budget Management Act. As per the latest fiscal path: The target debt-to-GDP ratio for the Central Government is 50% (±1%) by March 2031. This is a gradual reduction from current elevated levels (around 55–56% of GDP), ensuring fiscal sustainability.
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