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Public Debt Classifications, Features, Details



Public Debt, Classification of Public Debt, Voluntary debt, And Internal and External Debt

Money and interest/debt which the government has to pay back to the Public when it borrowed from it (please see above for the instruments used in Public Borrowing)  is known as Public debt.

Classification of Public Debt

Reproductive and Unreproductive debt- Reproductive debt is when money is borrowed to invest in an infrastructural project such as railways, irrigation, etc which when finished will be used by the public and provide revenue through taxes and be beneficial for the government.

On the other hand, unreproductive debt refers to those borrowings which are done for meeting expenditures such as war, etc which will not earn any direct revenue upon completion.

Voluntary debt- Voluntary debt occurs when the public is free to decide whether they want to provide loans to the government or not and compulsory is when the public is legally compelled to provide funds like in 1971 the ' Compulsory deposit scheme' was introduced.

Internal and External debt-  It has already been expanded.

Long term and short term debt- Long-term debt are when the debt should be paid after a year and short-term debt is when it has to be repaid within a year.


Latest Public Debt Updates

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