{"id":108915,"date":"2026-06-19T17:49:18","date_gmt":"2026-06-19T12:19:18","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=108915"},"modified":"2026-06-19T17:49:18","modified_gmt":"2026-06-19T12:19:18","slug":"state-finances-2024-25-report","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/state-finances-2024-25-report\/","title":{"rendered":"State Finances 2024-25 Report, Fiscal Deficit, Revenue Balance"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The CAG\u2019s State Finances Report 2024-25 highlights a significant structural shift in the expenditure pattern of Indian states, marked by a sharp rise in subsidy-driven spending. While subsidies are an important instrument of welfare delivery, their increasing dominance in state budgets raises concerns regarding fiscal sustainability, quality of expenditure, and long-term developmental priorities.<\/span><\/p>\n<h2><b>About State Finances 2024-25 Report\u00a0<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The <\/span><b>\u201cState Finances 2024-25\u201d <\/b><span style=\"font-weight: 400;\">report is an analytical publication <\/span><b>released by the <\/b><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/comptroller-and-auditor-generalcag\/\" target=\"_blank\"><b>Comptroller and Auditor General (CAG)<\/b><\/a><b> of India<\/b><span style=\"font-weight: 400;\">. It provides an <\/span><b>evidence-based assessment of the fiscal performance of Indian States, focusing on revenue balance, fiscal deficit, expenditure quality, and fiscal discipline.<\/b><\/p>\n<p><span style=\"font-weight: 400;\">The report evaluates how States are managing their finances in relation to budget targets, Finance Commission recommendations, and fiscal consolidation norms.<\/span><\/p>\n<h3><b>Key Features of the State Finances Report<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It <\/span><b>analyses fiscal outcomes of 28 States in 2024-25<\/b><span style=\"font-weight: 400;\">, including revenue balance, fiscal deficit, and expenditure trends.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It <\/span><b>compares budgeted fiscal targets with actual outcomes<\/b><span style=\"font-weight: 400;\">, including revenue surplus, revenue deficit, and zero-deficit targets.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It assesses compliance with the <\/span><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/15th-finance-commission\/\" target=\"_blank\"><b>15th Finance Commission<\/b><\/a><span style=\"font-weight: 400;\"> fiscal deficit benchmark of 3% of GSDP.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It highlights trends in <\/span><b>States\u2019 Own Tax Revenue (SOTR) and GST contributions.<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It evaluates <\/span><b>inter-state fiscal disparities and revenue performance.<\/b><\/li>\n<\/ul>\n<h2><b>State Finances 2024-25 Report Key Findings\u00a0<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The State Finances 2024-25 report highlights widening inter-State disparities in fiscal performance, with simultaneous existence of surplus and high-deficit States. It underscores rising subsidy burden alongside persistent fiscal consolidation challenges, reflecting growing welfare orientation in State finances.<\/span><\/p>\n<h3><b>Revenue Surplus and Deficit Across States<\/b><\/h3>\n<ul>\n<li aria-level=\"1\"><b>Of the 28 States, 18 targeted revenue surplus, 3 targeted revenue deficit and 7 targeted zero revenue deficit in FY 2024-25.<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Thirteen States recorded revenue surplus while 15 States remained revenue deficit.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Of the 18 States targeting revenue surplus, only 9 achieved the target, while States such as Karnataka, Maharashtra, Assam, Bihar, Himachal Pradesh and Telangana slipped into deficit.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Among States targeting zero revenue deficit, Goa, Jharkhand, Tripura and Uttar Pradesh achieved revenue surplus, while Punjab, Rajasthan and Tamil Nadu ended in deficit.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Himachal Pradesh, Mizoram, Punjab and West Bengal continued to receive Finance Commission revenue deficit grants.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>aggregate revenue deficit of deficit States stood at \u20b93.46 lakh crore<\/b><span style=\"font-weight: 400;\"> (1.5% of combined GSDP), while the net revenue deficit stood at \u20b92.19 lakh crore (0.68% of combined GSDP).<\/span><\/li>\n<\/ul>\n<h3><b>Fiscal Deficit and Debt Position<\/b><\/h3>\n<ul>\n<li><b>All 28 States recorded fiscal deficits in 2024-25.<\/b><\/li>\n<li><span style=\"font-weight: 400;\">Eighteen States exceeded the Fifteenth Finance Commission\u2019s fiscal deficit benchmark of 3% of GSDP.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">States witnessing a substantial increase in fiscal deficit included Andhra Pradesh, Assam, Gujarat, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Meghalaya, Mizoram, Nagaland, Odisha, Tripura and Uttarakhand.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The combined liabilities of States increased to \u20b990.51 lakh crore as on 31 March 2025, highlighting rising debt pressures.<\/span><\/li>\n<\/ul>\n<h3><b>Revenue Structure and Tax Mobilisation<\/b><\/h3>\n<ul>\n<li><b>States\u2019 own tax revenue accounted for nearly 50% of total revenue receipts<\/b><span style=\"font-weight: 400;\"> amounting to \u20b940.52 lakh crore.<\/span><\/li>\n<li><b>State GST contributed more than 43% of States\u2019 own tax revenues.<\/b><\/li>\n<li><b>States\u2019 own tax revenue more than doubled<\/b><span style=\"font-weight: 400;\"> from \u20b98.4 lakh crore in 2015-16 to \u20b920.31 lakh crore in 2024-25.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Tax collections recorded stronger growth in the post-GST period compared to the pre-GST era.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The share of <\/span><b>Grants-in-Aid<\/b><span style=\"font-weight: 400;\"> and Central assistance in State revenues declined over the decade, indicating increasing dependence on States\u2019 own resources.<\/span><\/li>\n<\/ul>\n<h3><b>Expenditure Profile of States<\/b><\/h3>\n<ul>\n<li><b>Combined expenditure of all States stood at \u20b951.20 lakh crore in 2024-25.<\/b><\/li>\n<li><b>Revenue expenditure<\/b><span style=\"font-weight: 400;\"> accounted for nearly 80% of total expenditure.<\/span><\/li>\n<li><b>Committed expenditure<\/b><span style=\"font-weight: 400;\"> (salaries, pensions and interest payments) exceeded 43% of total revenue expenditure.<\/span><\/li>\n<li><b>Committed expenditure, subsidies and grants together accounted for over 61% of revenue expenditure<\/b><span style=\"font-weight: 400;\">, reducing fiscal space for developmental spending.<\/span><\/li>\n<li><b>Education remained the largest expenditure head, followed by social welfare and energy.<\/b><\/li>\n<li><span style=\"font-weight: 400;\">The economic sector accounted for 63% of total capital outlay, reflecting continued emphasis on infrastructure creation.<\/span><\/li>\n<\/ul>\n<h3><b>Subsidy Trends Across States<\/b><\/h3>\n<ul>\n<li><b>Subsidy expenditure nearly tripled from \u20b91.4 lakh crore in 2015-16 to \u20b94.4 lakh crore in 2024-25.<\/b><\/li>\n<li><span style=\"font-weight: 400;\">Subsidies grew faster than overall State expenditure, which increased only 2.3 times during the same period.<\/span><\/li>\n<li><b>Subsidies as a share of State GDP increased from 7.7% to 10.2%<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li><b>Karnataka, Madhya Pradesh, Tamil Nadu and Punjab emerged as the highest subsidy-spending States<\/b><span style=\"font-weight: 400;\">, with subsidies exceeding 13.5% of total expenditure.<\/span><\/li>\n<li><b>Energy subsidies accounted for 43% of total subsidies, while agriculture accounted for 30%.<\/b><\/li>\n<li><b>Rajasthan recorded the highest power subsidy,<\/b><span style=\"font-weight: 400;\"> followed by Karnataka.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Maharashtra, Tamil Nadu, Karnataka, Madhya Pradesh and Rajasthan together accounted for \u20b92.3 lakh crore or 54% of total subsidy spending.<\/span><\/li>\n<\/ul>\n<h4><b>Inter-State Variation in Subsidy Spending<\/b><\/h4>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Six States spent over 10% of their expenditure on subsidies, while six States spent less than 1%.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>lowest subsidy-spending States included Arunachal Pradesh, Sikkim, Nagaland, Meghalaya, Tripura and Assam.<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Kerala, Mizoram, Uttarakhand and Manipur spent less than 2% of expenditure on subsidies.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Lower subsidy levels were associated with smaller consumer bases and limited industrial and irrigation activity.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Know the key findings of the State Finances 2024-25 Report, including fiscal deficit, revenue balance, subsidy expenditure, debt, and State finances.<\/p>\n","protected":false},"author":25,"featured_media":108885,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[786],"tags":[8218],"class_list":{"0":"post-108915","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-general-studies","8":"tag-state-finances-2024-25-report","9":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/108915","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/25"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=108915"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/108915\/revisions"}],"predecessor-version":[{"id":108929,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/108915\/revisions\/108929"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/108885"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=108915"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=108915"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=108915"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}