New Delhi, Sept. 15 -- Long-term bond yields have risen across the US, Europe and Japan as major advanced economies run high debt-to-GDP levels, signalling lower market tolerance for fiscal imprudence and rising inflation risks. India has a relatively lower level of debt, yet it is important for India to keep trimming its debt.

Indeed, during a recent address in Chicago, finance minister Nirmala Sitharaman reaffirmed the government's commitment to reduce the Centre's debt to 50% of GDP by 2030. This is in keeping with the fiscal glide path prescribed for the five years from 2026-27 to 2030-31.

If we assume that states' debt will remain at the current level of about 30% of GDP, total government debt should be at 80% of GDP by 2030. That ...