How much public debt is threshold in India?

Debi Prasad Bal ()
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Debi Prasad Bal: Birla Institute of Technology and Science, Pilani, Pilani Campus

Journal of Social and Economic Development, 2025, vol. 27, issue 1, No 6, 105-119

Abstract: Abstract The study examines the threshold level of India's public debt from 1970 to 2019. The ARDL method finds that a country’s public debt is driven mainly by its gross fiscal deficit, real interest rate, and economic growth. In addition, the ratio of public debt to GDP has been used by the genetic algorithm method. The findings show that the ratio of public debt to GDP must be at most 61–64% in India. According to the results of this study, economic development is boosted when the national debt falls below a threshold level. Therefore, the current idea of public debt is supported by modern theory on public debt.

Keywords: Public debt-to-GDP ratio; Genetic algorithm; Economic growth (search for similar items in EconPapers)
JEL-codes: C63 H68 O23 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s40847-023-00308-2

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