As per the October 2021 Fiscal Monitor Report of International Monetary Fund (IMF) titled, ‘Fiscal Monitor: Strengthening the Credibility of Public Finances’, the global debt (issued by governments, nonfinancial corporations, and households) in 2020 was increased by $27 trillion (from 2019) to a new high of USD 226 trillion.
- India’s debt in 2021 was projected to rise at 90.6 percent.
- Global debt in 2021 was reported at 97.8 percent whereas the 2022 debt was projected to be 96.9 percent.
India’s Fiscal Balance and Debt Comparison (2016-2026):
| Year | Government Fiscal Overall Balance (% of GDP) | Government Debt (% of GDP) |
|---|---|---|
| 2016 | -7.1 | 68.9 |
| 2020 | -12.8 | 89.6 |
| 2021(Projection) | -11.3 | 90.6 |
| 2022(Projection) | -9.7 | 88.8 |
| 2026(Projection) | -7.8 | 85.2 |
Key Points of the Report:
i.Advanced economies and China contributed to more than 90 percent of worldwide debt in 2020 whereas the remaining emerging economies and low-income developing countries contributed for around 7 percent.
ii.Global deficits are expected to decrease further by almost 3 percent in 2022 and return to their pre-pandemic levels by 2026.
iii.Global government debt is expected to decline in 2021 and 2022 by about 1 percentage point of GDP per year.
iv.The debt crisis might include more people in poverty in 2021, which is estimated to be around 65 to 75 million higher than pre-pandemic levels.
Note: The IMF notified the risk of a sharp decline in global equity prices and home values as the central banks might withdraw the support they have provided during COVID-19.
Recent Related News:
In order to boost global liquidity and curb COVID-19 impact, the Board of Governors of the International Monetary Fund (IMF) has approved a general allocation of Special Drawing Rights (SDRs) equivalent to US$650 billion (about SDR 456 billion) w.e.f. August 23, 2021. It is the largest SDR allocation in the history of the IMF.
About International Monetary Fund (IMF):
Establishment – 1944
Headquarters – Washington, D.C., United States
Member Countries – 190
MD – Kristalina Georgieva
