New Delhi, Jan. 19 -- Basant Bafna, the head of fixed income at Mirae Asset Investment Managers (India), believes the government will keep fiscal consolidation in focus while maintaining growth momentum in Budget 2026. He says central government borrowings may remain stable, while state borrowings are likely to rise compared to FY26. In an interview with Mint, Bafna shares his views on how the government's increased focus on fiscal consolidation may impact bond yields and spread, among other things.

India's fiscal consolidation story remains intact, though the pace is likely to moderate.

The government remains committed to a steady fiscal consolidation path, with the debt-to-GDP ratio expected to ease from nearly 56% to close to 50% ove...