Publication

The financial crisis in Greece and the measures to tackle it have led to a considerable debate on how fiscal deficits should be managed by countries facing fiscal stress. While the immediate causes for worry are Greece’s ballooning budget deficit and the risk that other fragile countries like Spain and Portugal might default, the turmoil has also exposed deeper fears that government borrowing in bigger nations could be unsustainable. To some degree, these concerns are relevant for countries like India and those staring at similar numbers. In this context, this piece explores the relevance of the proposed Greece’s solutions for India in managing its fiscal stress.