States’ debt at record in FY23

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₹753,860 crore during 2022-23 (budget estimate), compared to ₹656,626 crore debt (revised estimate) during 2021-22. Similarly, Uttar Pradesh saw its debt increase to ₹710,210 crore during 2022-23, from ₹656,626 crore during the previous year. Maharashtra saw its debt increase to ₹680,357 crore during 2022-23 from ₹596,689 crore during the previous fiscal.

West Bengal’s net liabilities increased to ₹608,313 crore in 2022-23, from ₹550,708 crore in the previous year. Rajasthan’s net debt increased to ₹537,013 crore during 2022-23, up from ₹458,089 crore a year ago. Karnataka’s net debt increased to ₹535,157 crore in 2022-23, from ₹473,438 crore in 2021-22.

Interestingly, Odisha was the only state that decreased its liabilities to ₹113,856 crore in 2022-23 from ₹129,356 crore in 2021-22. Other states that saw their debt pile rise during the last fiscal included Andhra Pradesh ( ₹442,442 crore), Gujarat ( ₹423,711 crore), Kerala ( ₹390,860 crore), Madhya Pradesh ( ₹378,617 crore), Telangana ( ₹366,306 crore), Punjab ( ₹305,047 crore) and Haryana ( ₹287,266 crore). According to government data, outstanding liabilities of as many as 28 states rose by over 43% in the three years from March 2020 to March 2023.

States’ outstanding debt has shown a gradual upward movement due to implementation of Ujjwal DISCOM Assurance Yojana, farm loan waivers, pandemic-related revenue losses, which was furthered hampered by additional expenditures and growth slowdown, the ministry of finance had said in response to a parliamentary question during the budget session in February. The Union finance ministry didn’t respond to queries sent by Mint. All states and Union territories have enacted their Fiscal Responsibility and Budget Management (FRBM)