Indian fiscal picture damaged by pension promises

India's glitzy macroeconomic story has always been tempered by its chronic budgetary problems, with the government's explicit internal debt at 85% of GDP, plus a trade deficit of $30 billion in the year to May. Nonetheless, a rocketing stock market, rapidly rising inflows of foreign direct investment, and respectable GDP growth - along with a deep supply of well-managed, shareholder-friendly companies - has made India a trendy destination for foreign capital.