Avoid debt trap
The Indian economy has performed well on several fronts. It has been a bumpy ride though for an economy beset by several problems and hurdles. Today, a sanguine finance minister promises to do his utmost best to gear India into the new millennium and work towards achieving the high GDP target of eight per cent. But, first of all he has the indomitable task of tackling a rising fiscal deficit.

Better placed than before
In the millennium Budget 2000 finance minister Yashwant Sinha has adopted many hard hitting measures. The most significant among them being the announcement that there would be no roll backs. In this the FM has been very fortunate as all macro economic parameters favour this strong stance taken by him.

Waning ECB enthusiasm
Responding to the fast changing scenario in the international money markets, the Indian Government has taken some very bold steps to liberalise external borrowings (ECBs). This paradigm shift by power brokers was in a bid to make India emerge an Asian Tiger.

Indebted to ongoing reforms
India's current external debt figure of US $99 billion, many argue, is not a worrisome figure. Despite an increase in India's debt stock, there has been considerable improvement in the country's major debt indicators. This is reflected in the overall improvement in the debt scenario of the country.

Are we getting debt-trapped?
No doubt India's fiscal situation is alarming. But the US $99 billion external debt figure is inflated. International investors are shying away from investing in India. And the finance minister is saddled with the difficult task of convincing his counterparts that after all it is not very bad out here. For, statistics is a game which can be easily manipulated and interpreted to suit ones needs.

"There is no urgency to repay"
India's overall external debt situation appears to be within manageable limits. Sanjeev Sanyal, Deutsche Bank’s regional economist spoke to FE-Thinktank. The finance minister is correct in concentrating on the fiscal deficit as it is a more immediate threat to economic stability.

"External debt is not worrisome"
India's external debt situation today is far better off than it was in the past. Basudeb Sen, executive director of Unit Trust of India spoke to FE-Thinktank. India’s overall debt at US $99 billion does not seem to be a problem area as far as the Finance Minister is concerned.

"Relate external debt to key parameters such as exports"
Prudent management of external debt is as crucial as the task of reining in fiscal deficit. This is from S S Bhandare, economic advisor with the Mumbai-based Tata Services. Here, Bhandare speaks to FE-Thinktank on India’s external debt situation.