Fiscal Deficit Below 3% In 10 States, 13 See Revenue Surplus In 2024-25
GS3Economy · S&T · Environment · Security· Fiscal policy, budget & taxation (GST)· Prelims + Mains·
Why in news
The CAG's State Finances 2024-25 report highlights that 18 Indian states exceeded the recommended 3% fiscal deficit limit of GSDP, indicating a heavy reliance on borrowing.
Background
The Comptroller and Auditor General (CAG) reported that 10 states maintained a fiscal deficit below 3% of GSDP, while 18 states exceeded it. Goa recorded the lowest deficit at 1.7% in the 2024-25 period.
Facts for Prelims
- FactGoa recorded the lowest fiscal deficit at 1.7% in the 2024-25 report.
- FactMeghalaya, Nagaland, Sikkim, Himachal Pradesh, and Mizoram reported fiscal deficits exceeding 5% of GSDP.
- BodyThe CAG is the supreme audit institution of India, reporting on state finances and expenditures.
- Fact13 states reported a revenue surplus in the 2024-25 fiscal period.
For Mains
Q. Analyze the fiscal implications of states exceeding the 3% fiscal deficit limit and discuss the role of the CAG in ensuring fiscal discipline in a federal structure.
Dimensions to cover in your answer
- Debt sustainability: Risk of crowding out private investment due to high state-level borrowing for infrastructure and subsidies.
- Fiscal federalism friction: Tension between state-level developmental spending requirements and central fiscal deficit guidelines.
- Revenue imbalance: Structural reliance on market borrowings to bridge the gap between recurring expenditure and revenue generation.
Keywords: Fiscal Discipline · Debt Sustainability · Fiscal Federalism · CAG Audit · GSDP · Revenue Surplus
More Economy notes
- Union Finance Minister says State borrowing justified if spent on capex · 26 June 2026
- Recruitment drive set to kickstart in Karnataka with number of jobs enhanced to 72,186 · 26 June 2026
- Amazon $48 Billion, Google $15 Billion: Global CEOs' India Investment Push · 25 June 2026
- The RBI introduced a new compensation framework for digital fraud victims to address rising concerns over cyber-fraud in banking transactions · 25 June 2026
- India-US Trade Deal "Close", Tariff Edge Over Competitors Key: Piyush Goyal · 25 June 2026
- Centre's Rs 99,446-Crore Plan Fuels Job Boom: 1.4 Crore Join Formal Economy · 25 June 2026
Something wrong, or something missing?
Spotted a mistake in a note, or want a topic, format or PDF that would help your preparation? Write to us. We read every mail and fix errors fast.
This note is generated automatically from SatyaDheesh's news feed and mapped to the UPSC CSE syllabus. Check facts against the original report or PIB before using them in an answer.