Purpose: This study aimed to investigate the trends and sustainability of public debt in India from 1980 to 2022. Design/Methodology/Approach : A moving average and graphical approach were employed to capture the trend in India’s internal, external, and total debt. The fiscal reaction function (FRF) and indicators-based approach were applied to examine the sustainability of public debt under the autoregressive distributed lag model.

Findings: The graphical and moving average results indicated that India’s overall public debt-to-GDP ratio increased over the study period. A significant decline was observed in the external debt-to-GDP ratio, particularly after the 1991 economic reforms. In contrast, the internal debt-to-GDP ratio indicated an upward trend. The indicator-based approaches showed mixed results. The FRF results indicated that during the study period, public debt in India remained sustainable due to a favorable interest-growth differential rather than a positive primary balance. Practical

Implications: The findings of the present study improved the understanding of public debt behavior and sustainability concerns in India. Originality/

Value: This study contributed to the literature by conducting trend analysis of public debt and debt components and sustainability, examined through an indicator-based approach and the FRF. It made a valuable contribution to the literature on public debt trends and sustainability, using a theoretical and empirical methodological framework. Additionally, it explored how macroeconomic variables over the five phases of the study period determined debt sustainability in India.

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