Who Does India Owe Money To?
RBI Handbook · Budget 2026-27 · Medium-term Fiscal Policy StatementStructure of India's public debt — holders, composition, and trajectory
India's public debt is overwhelmingly internal — over 95% is owed to domestic institutions: commercial banks, insurance companies (primarily LIC), provident funds, and the Reserve Bank of India itself. This “home bias” insulates India from exchange-rate shocks but creates a crowding-out dynamic — government borrowing competes with private investment for the same pool of domestic savings.
Outstanding Liabilities (est.)
~₹180L Cr
~57% of GDP
▼ Declining from 61% peak (FY21)
Gross Market Borrowing
₹15.68L Cr
BE 2026-27
▲ 5.9% vs prev. year
Interest Payments
₹13.35L Cr
4.5% of GDP
Largest single line item
External Debt Share
~5%
of total liabilities
95% internal — home-biased
Who Holds the Debt · % of total outstanding domestic liabilities
Commercial Banks
38.2%
₹59.3L Cr
Insurance Companies (LIC & others)
24.8%
₹38.5L Cr
Provident Funds & Pension Funds
14.6%
₹22.7L Cr
Reserve Bank of India
12.1%
₹18.8L Cr
Mutual Funds
5.3%
₹8.2L Cr
Foreign Portfolio Investors
2.8%
₹4.3L Cr
Others (individuals, corporates, state govts)
2.2%
₹3.4L Cr
Debt-to-GDP Trajectory · % · FY15 → FY27 (BE) → FY31 (target)