What is Public debt

Public debt is the total amount, including total liabilities, borrowed by the government to meet its development budget. It has to be paid from the Consolidated Fund of India. The term is also used to refer to overall liabilities of central and state governments, but the Union government clearly distinguishes its debt liabilities from the states’.

 

The central government broadly classifies its liabilities into two categories — debt contracted against the Consolidated Fund of India, and public account.

 

Over the years, the Union government has followed a considered strategy to reduce its dependence on foreign loans in its overall loan mix. Internal