India's Debt Servicing Soars Past ₹81 Lakh Crore Over Six Years

India's central government incurred over ₹81 lakh crore in interest and loan repayments from 2020 to 2026, according to the Finance Ministry. Interest payments rose yearly, with a significant budgetary projection for 2026-27 indicating the debt might exceed ₹218 lakh crore.

In a significant financial revelation, India's central government has expended more than ₹81 lakh crore on interest payments and loan repayments from the fiscal years 2020-21 to 2025-26. The disclosure was made in a written statement by Minister of State for Finance, Pankaj Chaudhary, during a session in the Rajya Sabha earlier this week.

The breakdown of expenses shows that ₹58.37 lakh crore was allocated for interest payments, while ₹22.80 lakh crore was dedicated to principal repayment. The fiscal data highlighted a consistent upward trend in interest payments each year, escalating from ₹6.80 lakh crore in 2020-21 to a provisioned ₹12.43 lakh crore in 2025-26.

Principal repayments also followed a similar rising pattern. This financial trajectory has propelled the government to anticipate debt servicing costs surpassing ₹20 lakh crore for the financial year of 2026-27. Meanwhile, the government's total liabilities are projected to increase to ₹218.63 lakh crore by the conclusion of 2026-27, showcasing a complex fiscal landscape ahead as projected by the Budget Estimate.