Rudyard Kipling never said what kind of bear Baloo is meant to be.
However, due to the descriptions found in the series, his behaviour, feeding habits, and the location of where the story takes place (Seoni, Madhya, India) greatly narrow down the list of possibilities.
The general consensus is that he is most likely a sloth bear, and is listed as such in his character page on Wikipedia.
Like sloth bears, Baloo sees ants and termites as a very desirable treat, though most of the year the bulk of his diet largely consists of honey and fruits.
Baloo is also officially canonically a sloth bear in the 2016 Disney remake of its 1967 rendition of the Jungle Book, as Bagheera explicitly states that Baloo is a sloth bear.
It’s worth noting, however, that despite Bagheera’s claim, the bear’s appearance in the remake more closely resembles a Himalayan brown bear, which would be a highly unlikely species to find in the part of India the story takes place (but not entirely impossible).
There’s also always the possibility that Remake-Baloo was intended to be a Himalayan brown bear all along and that Bagheera refers to Baloo as a sloth bear in the movie as a mix of a light insult and wordplay referencing the fact that the bear in question is extremely lazy, the fact that there really is such a thing as sloth bears being the icing on the proverbial cake.