Government Used Most FY26 Borrowing to Service Debt

India’s debt profile is under strain as 81.8% of FY26 borrowing went to interest payments, up sharply from 50.9% in FY22. Outstanding debt stood at ₹201.17 lakh crore (March 2026), projected to rise to ₹228.27 lakh crore by FY27. While the debt‑to‑GDP ratio eased to 58.2% and is forecast at 55.6%, interest payments remain heavy at ₹12.43 lakh crore in FY26, budgeted at ₹14.04 lakh crore for FY27, consuming 26% of expenditure and 40% of revenue receipts.