Archive · 18 Dec 2025
Sitharaman Focuses on Debt Reduction and Fiscal Transparency
Finance Minister Nirmala Sitharaman has said that the government will focus on reducing debt levels and making sure that how money is managed is clear and accountable.
She wants states to do the same.
The debt-to-GDP ratio, which was high after COVID, has been coming down.
The goal is to make India a developed nation by 2047.
Sitharaman also said that states need to manage their debt better so that they can spend money on development instead of just paying off old loans.
The government is also working to make the bond market stronger and ensure that everyone has access to credit.
She believes that India can contribute 25% to world trade and grow in manufacturing, agriculture, and services.
Finance Minister Nirmala Sitharaman announced that reducing debt levels and enhancing fiscal transparency will be key focus areas for the next fiscal year (2026-27).
The central government has set clear goals for transparency in budget-making and fiscal management, aiming to reduce the debt-to-GDP ratio from 61.4% post-COVID to 56.1% this year.
Sitharaman urged states to prioritize accountability and transparency in fiscal management to reduce debt levels and avoid borrowing for loan servicing rather than development.
The government is working to deepen the bond market to allow more funds to flow in and is focusing on financial inclusion and credit access via Mudra.
Sitharaman expressed the vision of making India a developed nation by 2047, aiming for India to contribute 25% to world trade and grow in manufacturing, agriculture, and services.
- Who
- Finance Minister Nirmala Sitharaman
- What
- Announced focus on reducing debt levels and enhancing fiscal transparency
- When
- Next fiscal year (2026-27)
- Where
- India
- Why
- To achieve the goal of becoming a developed nation by 2047 and ensure fiscal responsibility
- Debt-to-GDP Ratio (Post-COVID)
- 61.4%
- Debt-to-GDP Ratio (2023-24)
- 57.1%
- Expected Debt-to-GDP Ratio (Current Year)
- 56.1%
- Focus Areas
- Debt Levels, Fiscal Deficit, Transparency
- Goal Year for Developed Nation
- 2047
- Government's Fiscal Management Goal
- Transparency and accountability
- Government's Bond Market Initiative
- Deepening the bond market
- Government's Credit Access Initiative
- Financial inclusion and credit access via Mudra
Sources
FM Sitharaman says debt levels to be core focus from next fiscal; calls for transparency in fiscal management
FM Sitharaman Flags State Debt Risks, Pushes Manufacturing Focus
Cutting debt-to-GDP ratio will be govt’s core focus in coming fiscal: FM Sitharaman
