New Delhi, Jul 20 (IANS): As the coronavirus pandemic brings the economy to a grinding halt, raising the need for the higher government spending, India's gross debt is likely to touch Rs 170 lakh crore, which is 87.6 per cent of the GDP, according to the SBI Ecowrap.

The report also said that the higher debt amount will shift the FRBM target of combined debt to 60 per cent of GDP by FY23 by seven years with the target now seen achievable in FY30 only.

"Higher level of borrowing this fiscal is likely to increase gross debt further to around Rs 170 lakh crore or 87.6 per cent of GDP. Within this, external debt is estimated to increase to Rs 6.8 lakh crore (3.5 per cent of GDP). Of the remaining domestic debt, component of State's debt is expected at 27 per cent of GDP," it said.

In the financial year 2019-20, India's debt stood at Rs 146.9 lakh crore, 72.2 per cent of GDP, increasing from Rs 58.8 lakh crore in FY12.

"The GDP collapse is pushing up the debt to GDP ratio by at least 4 per cent, implying that growth rather than continued fiscal conservatism is the only mantra to get us back on track," it said.