TOKYO, March 1: The Japanese government's debt pile could nearly double by the 2017/18 fiscal year to top 900 trillion yen ($8.3 trillion), according to calculations by Japan's postal service body.

Japan Post, in a business plan presented before a ruling Liberal Democratic Party subcommittee, projected the outstanding volume of ordinary government bonds to balloon to 903.68 trillion yen in fiscal 2017/18 from 482.63 trillion in 2004/05, starting April 1.

The document said the projection was based on a Ministry of Finance analysis of the future impact of revenue and spending patterns in fiscal 2004/05.

Japan Post, a transitional body that Prime Minister Junichiro Koizumi wants to eventually privatise, inherited the postal savings and insurance systems from the former Postal and Telecommunications Agency a year earlier and is a huge investor in government bonds.

Japan's broader public sector debt, at just under 700 trillion yen at the end of March, is already worth some 140 per cent of the nation's gross domestic product - the highest ratio among industrial countries.

With about 36.4 trillion yen of new bonds issued in the current fiscal year and a further 36.6 trillion yen added next year, analysts say debt servicing costs would put more strain on an already stretched budget, accelerating growth in debt. -Reuters