Ways out

Try your strategy

Run the family business your way. Set how much to tax, spend, borrow and repay, and see where the debt goes by 2035.

These pages describe options and what happened when countries tried them. Budgets LK does not recommend any option, and nothing here is a forecast or financial advice. This tool is a simple illustration. It shows the arithmetic of the choices you make, not what would happen in practice.

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Debt in 2032

Debt in 2035

Interest in 2035of every Rs 100 earned

Income

Extra tax and other income % of GDP Raises government income as a share of the economy, phased in over the years chosen below. Minus means less income. About: Collect more tax

Spending

Change in spending before interest % of GDP Minus means spending less, plus means spending more, phased in over the years chosen below. About: Spend less

Economy

Real growth of the economy % a year How fast the economy grows once prices are set aside. About: Grow the economy Inflation % a year Price rises. Higher prices also raise the rupee size of the economy. About: Print more money How much tax rises and cuts slow the economy points per point Economists disagree on this. At 0 there is no slowdown. At 0.5, each 1 point of GDP of extra tax or cuts in a year lowers growth that year by half a point.

Loans and interest

Interest rate on new loans % What the government pays on money it borrows from now on. Old loans move to this rate as they are repaid. About: Ask lenders for easier terms Average years to repay a loan years Longer loans take longer to feel a new interest rate. 8 is an illustrative choice, not a published figure. About: Ask lenders for easier terms Interest cut agreed with lenders (from 2027) points A one-off cut in the average rate on existing debt, for example through new loan terms. About: Ask lenders for easier terms Debt written off by lenders (in 2027) % of debt A share of the debt that lenders agree not to be repaid. About: Ask lenders for easier terms Money from selling or leasing assets (in 2027) % of GDP A one-off payment used to repay debt. About: Sell or lease what the state owns Most the government may borrow in a year % of GDP If the plan needs more than this, the table shows the gap. 12 means no limit.

Timing

Years to phase in tax and spending changes years Tax and spending changes build up evenly over this many years.

Your strategy IMF projection settings 95% IMF programme goal for 2032

In family terms

Year by year (all as % of GDP)

Year	Income	Spending before interest	Interest	Borrowing	Debt

How this works, and what it leaves out

Each year, income and spending before interest are set from the IMF's 2030 figures shown on this site (income 15.5% and spending before interest 12.9% of GDP) plus the changes you choose. Interest is the average rate on the debt times last year's debt. The gap between income and spending plus interest is borrowed, so debt as a share of GDP = last year's debt ÷ (1 + growth of GDP in rupees) + that year's borrowing. Debt starts at 96.8% of GDP in 2025 (IMF, general government gross debt). The starting interest rate is the Central Bank's actual interest paid in 2025 divided by central government debt at the end of 2025.

It does not model exchange rate moves, how markets or voters react, new borrowing for reasons other than the gap, or how long any change would take to agree. Printing money is not a setting, because its effect on prices cannot be reduced to one number. Set inflation yourself to explore it. The 95% goal line is the IMF programme's goal for public debt in 2032.

Try your strategy

In family terms

Your strategy uses

How this works, and what it leaves out