Key facts
- All 28 Indian states reported fiscal deficits in FY25.
- Combined state liabilities reached Rs 90.51 lakh crore by March 31, 2025.
- 13 states achieved revenue surpluses in FY25, while 15 states had deficits.
- 18 states exceeded the 3% GSDP fiscal deficit target.
- Committed expenditure (salaries, pensions, interest) accounted for over 43% of revenue spending.
- States' own tax revenue accounted for 50% of total revenue receipts.
A report by the Comptroller and Auditor General of India (CAG) on 'State Finances 2024-25' revealed that while all 28 Indian states recorded fiscal deficits in the financial year 2024-25, 13 states managed to achieve revenue surpluses. Despite this, the combined liabilities of all states reached Rs 90.51 lakh crore by March 31, 2025. The report also indicated that 18 states exceeded the 3% of Gross State Domestic Product (GSDP) fiscal deficit target.
Committed expenditure, including salaries and pensions, continued to form a significant portion of state spending, accounting for over 43% of revenue expenditure. States' own tax revenues played an increasingly crucial role, making up 50% of the total combined revenue receipts of Rs 40.52 lakh crore. The report noted a substantial increase in fiscal deficits in 2020-21 and again in 2024-25, with states generally remaining in revenue and fiscal deficit throughout the 2015-16 to 2024-25 period.