Japan should not backpedal on its efforts to restore fiscal health as the likelihood of higher interest rates would mean increased payments for the debt-ridden nation, potentially limiting its room for future emergency spending, a fiscal policy advisory panel said Tuesday. In a set of recommendations submitted to the government before it draws up a fiscal policy blueprint this summer, the panel underscored the need to reduce the budget deficit and the size of the national debt in relation to the economy. Japan has set a goal of recording a surplus in the primary budget balance — tax revenues …