Due to the implementation of public utility schemes announced during the election period and the deteriorating financial situation, the debt burden on the state is increasing day by day. By the end of June, the debt figure had reached INR 8,55,397 crore. The government has borrowed INR 24,000 crore in the first three months of the financial year alone, and the Finance Department has projected that the debt figure will reach INR 9,32,242 crore by the end of the year.
The state government can borrow up to a maximum of 25 percent of its gross domestic product. This financial year, it has borrowed up to 18 percent of this limit. As per the limit, the Central Government has allowed the state government to raise a loan of INR 1,46,687 crore in the financial year 2025-26. Of this, a loan of INR 99,000 crore will be raised for the first nine months. Of this loan, INR 10,000 crore will be taken from NABARD and National Housing Bank.
According to the Finance Department data, the government borrowed a total of INR 34,589.55 crore in April of the new financial year 2025-26. It repaid a loan of INR 21,956 crore in the same month. In May, the government took a loan of INR 19,173 crore and repaid INR 19,254 crore, while in June, the government took a loan of INR 22,725 crore and repaid Rs 12,262 crore in the same month.
The total amount of loan repayment in the three months is INR 52,472 crore. The state government raised the loan amount through bonds from the open market at an interest rate of seven to seven and a half percent. The state government has received loans from NABARD and National Housing Bank at an interest rate of four and a quarter percent, without bonds.
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The government had to pay INR 41,689 crore on interest of INR 64,659 crore in the financial year 2022-23. INR 45,652 crore in 2023-24 and INR 54,687 crore in 2024-25. The Finance Department has estimated that the government will have to pay INR 64,659 crore in interest on total debt by the end of the current financial year.