Government’s focus on reducing ratio of debt to GDP: Minister of State for Finance

New Delhi: To reduce the interest-to-revenue ratio, the government’s strategy is to focus on ensuring a downward trajectory ratio of debt to GDP, Minister of State for Finance Pankaj Chaudhary said on Tuesday.

As announced in the Budget Speech for the FY 2024-25 (Regular), debt to GDP ratio has been chosen as the fiscal anchor from FY 2026-27 onwards, he said in a written reply in the Rajya Sabha.

As per Budget 2025-26, he said, the government aims to keep the fiscal deficit in each year in such a manner that the Central Government debt is on a declining path to attain debt-to-GDP level of about 50±1 per cent by March 31, 2031.

Fiscal deficit is a consolidated measure which is arrived at after subtracting non-debt receipts from total expenditure.

Interest payments are 25.2 per cent of total expenditure and 37.3 per cent of revenue receipts as per the Union Budget 2025-26.

The fiscal space has been calibrated to increase the trend of capital expenditure from Rs 4.26 lakh crore in FY 2020-21 to Rs 11.21 lakh crore in BE 2025-26, he said.

Further, he said, one of the measures of welfare expenditure, Centrally Sponsored Schemes (CSS), has increased from Rs 3.84 lakh crore in FY 2020-21 to Rs 5.42 lakh crore BE 2025-26.

Replying to another question, Chaudhary said, all insurers, who have unclaimed amounts of policyholders for a period of more than 10 years required to transfer the same with interest to the Senior Citizens’ Welfare Fund (SCWF) every year as per Insurance Regulatory and Development Authority (IRDAI) norms.

Further, he said, even after transfer of the unclaimed amounts to the SCWF, the policyholders/claimant continues to be eligible to claim the amounts due under their respective policies for a period of upto 25 years.

The SCWF is utilised for such schemes for the promotion of the welfare of the Senior Citizens in line with the National Policy on Older Persons and the National Policy on Senior Citizens, he said.

Unclaimed amounts of insurers were Rs 25,403 crore as on March 2022. It came down to Rs 23,699 crore as on March 2023 and Rs 21,718 crore at the end of March 2024.

IRDAI has implemented various measures to settle unclaimed insurance amounts and prevent further accumulation of unclaimed funds, he said.

Information on unclaimed amounts is centrally made available in the Bima Bharosa portal of IRDAI. This portal enables consumers/ all policyholders search unclaimed amounts across the insurers at one place and claim accordingly, he added.