Union Finance Minister Nirmala Sitharaman on Wednesday stated that lowering the debt-to-GDP ratio will be a major priority for the government in the upcoming financial year. Speaking at the Times Network India Economic Conclave, she emphasized the need to further reduce the ratio, which had crossed 60 percent during the Covid-19 period. While the figure has begun to decline, she said sustained efforts are required to bring it down further.

Sitharaman also called on state governments to take similar steps to manage their debt levels. Referring to RBI data, she noted that debt accumulation in certain regions is concerning, although she did not name specific states. She warned that unless high-interest debt is reduced to manageable levels, achieving the goal of a developed India, or Viksit Bharat, would be challenging.

The finance minister said the Centre is working to strengthen the bond market to enable smoother fund flows. She credited policy stability under Prime Minister Narendra Modi for building investor confidence and enabling effective negotiations. She reiterated that maintaining fiscal discipline remains a continuous priority.

On global trade, Sitharaman remarked that trade conditions are neither fair nor free, with tariffs increasingly being used as strategic tools. She said India contributes roughly a quarter of global trade and must navigate the evolving geopolitical landscape carefully. While India seeks to protect its economy and industries, it has not aimed to weaponise tariffs, unlike some emerging global players.

Highlighting sectoral growth, Sitharaman praised the services sector for driving nearly 60 percent of GDP growth, noting that it extends beyond IT to areas like tourism and hospitality. She said the government is creating conditions that allow all sectors, including manufacturing, to grow and compete globally.

To boost private sector participation, she stressed the importance of helping businesses expand, create jobs, and contribute more to GDP. She added that the reduction in corporate tax rates was a necessary step. Welcoming the rise of global capability centres and data centres, she underlined the need for energy security and said the government is investing in nuclear power, including small modular reactors, as a clean energy source alongside renewables.

Sitharaman also highlighted the growing entrepreneurial momentum in smaller towns and rural areas, noting that local businesses are supporting regional economies while aiming for global markets. She said the government is focused on nurturing entrepreneurial talent and expanding access to credit. Concluding, she said India has managed geo-economic challenges effectively and that the resilience shown by its people, especially during the Covid period, deserves recognition.