In their efforts to tackle the financial crisis, the world's three top developed nations, the US, UK and Japan, have accumulated massive debts, which are set to exceed or equal the size of their economies.
In comparison, the Indian government's total debt would still remain well below the country's GDP size, although it is also increasing due to its massive borrowing programme.
Collectively, the total debt of the US, UK and Japan has already reached a size of about $17 trillion (Rs 8,16,00,000 cr), an amount nearly 25 times of that in India.
With an estimated total debt of about Rs 34,00,000 crore for the current fiscal, India's debt burden accounts for just about 80 per cent of its GDP size. India's total debt at the end of last fiscal stood at about Rs 31,00,000 crore, but the government has announced a massive borrowing programme of about Rs 3,60,000 crore for the current financial year.
In comparison, Japan's debt position is already almost double its GDP size, while the national debt in the US and UK are expected to soon equal or exceed their respective GDPs.
While the US holds the maximum debt of over $11 trillion, the same in the UK is also over one trillion dollars. Besides, Japan's debt position is over $5 trillion and is estimated to increase to over $8 trillion by the next year.
Besides, due to their shrinking economies as a result of the global economic downturn, the debt-to-GDP ratios are expected to further rise in those economies. In comparison, India is still managing a decent economic growth rate, which would keep the debt-to-GDP ratio in check.
Going by the latest available data, the national debt of America, which has initiated massive stimulus programmes in recent months, is currently estimated at $11.41 trillion as against a GDP size of about $14 trillion.
According to data available with IMF, the US would see its government debt nearly equaling its economic size in 2010 and then exceed the level by 2014. The IMF has said that the government debts would exceed the GDP size for at least six developed economies, Belgium, Greece, Ireland, Italy, Japan and the US, by 2014.
At the same time, global rating agency major S&P has warned that the UK was projected to incur debts to the tune of 100 per cent of its GDP by 2013. Currently, the UK's debt level stands over $1 trillion and accounts for nearly 50 per cent of its GDP size of about $2.77 trillion.
Reeling under recession, Japan is also expected to accumulate debts which would be about 200 per cent of the country's GDP by as early as 2010, as per global financial services major Deutsche Bank. The Japanese economy is worth about $4.4 trillion and such huge debts would translate to an amount of about $8 trillion.
"Japan had amassed the largest (gross) government debt of all the industrial nations. Its latest debt-financed stimulus packages are very likely to send this debt spiraling to over 200 per cent of GDP by 2010 at the latest," DB Research said in a report.
Painting a gloomy picture, the report pointed out that if, as in the past ten years, the growth of Japan's debt load continues to outstrip GDP growth, the debt level will surge to as much as 300 per cent of GDP by 2020.
