Post-COVID-19 paths to fiscal consolidation - Using the snowball effect

In order to analyse how the excess of growth over the real interest rate can best contribute to Indian post-COVID-19 debt adjustment paths, the article draws on historical experience, past adjustment episodes and special features of emerging markets. It notes that a countercyclical primary deficit will contribute, and together with a substantial g–r gap, lower debt most efficiently, creating space for adequate fiscal response to future shocks. © 2021 Economic and Political Weekly. All rights reserved.