Assessing the Macroeconomics Implications of The Unified Pension Scheme in India: An Analysis of The Effects on Fiscal Sustainability

The fiscal impact of pension schemes has long been a subject of concern for policymakers due to their significant role in shaping public expenditure and economic stability, with the debate on welfare and efficiency continuing in this aspect as well. In this direction, the newly introduced Unified Pension Scheme (UPS) was expected to give perfect solutions to the problems rather than to escalate the problems further. In light of the present circumstances, the study presents an opportunity to evaluate the interplay between fiscal sustainability and individual financial behaviour through the empirical methods of debt sustainability analysis and cross-sectional regression. The findings are intended to advise policymakers for balancing fiscal prudence with broader socioeconomic goals of pensionary reforms. Concepts of behavioural economics and comparative analysis comprising the case studies of the US, Sweden and Argentina are also made to give valuable insights and recommendations for successful pensionary reform.