Niranjan Rajadhyaksha: Governments can’t borrow endlessly—and the bill often gets publicly shared
Global public debt has surged, challenging the notion of infinite government borrowing. Even currency-issuing nations face market scrutiny, as evidenced by rising US bond yields. The International Monetary Fund warns that investor patience is waning. Economic dynamics suggest debt sustainability depends on GDP growth, interest rates, and budget balances. If growth lags borrowing costs, governments must cut spending or raise taxes. Without central bank monetization, debt requires future surpluses; otherwise, inflation results. Financial repression, using regulations to suppress borrowing costs, is another potential, yet risky, recourse, potentially leading to capital controls in open economies.
LiveMint · Niranjan Rajadhyaksha · Oct 6, 2026 at 6:27 AM