Tokyo: Japan's parliament has approved an 18.3 trillion yen (approximately 118 billion USD) supplementary budget for the current fiscal year ending March 2026. This budget is aimed at financing Prime Minister Sanae Takaichi's extensive stimulus package, which has prompted concerns about the nation's fiscal health.

According to Namibia Press Agency, the budget successfully passed through the House of Councillors, the parliament's upper chamber, a day before the end of the current Diet session. This follows its earlier approval by the House of Representatives. Even though Prime Minister Takaichi's Liberal Democratic Party does not hold a majority in the upper house, the bill was supported by some opposition parties, including the Democratic Party for the People, due to its inclusion of their proposals for relief measures.

The budget, developed under Takaichi's "responsible and proactive fiscal policy," is the largest since fiscal 2022. It allocates 8.9 trillion yen to mitigate the impact of elevated living costs on households, through measures such as tax cuts, subsidies, and cash handouts. Additionally, 6.4 trillion yen is dedicated to bolstering investment in crisis management and growth, with a focus on advancing AI research and development, enhancing shipbuilding, and space strategy. Security and diplomacy efforts are also addressed with a 1.7 trillion yen allocation.

Japan's government debt-to-GDP ratio is currently near 240 percent, the highest among advanced economies. Despite this, the government plans to issue 11.7 trillion yen in new bonds to cover over 60 percent of the supplementary budget, raising questions about the sustainability of Japan's fiscal position.