Will the Bengal Government Exhaust 95% of Its Market Borrowing Target by December 2025?
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Synopsis
As the West Bengal government approaches a significant milestone, it is set to exhaust nearly 95% of its market borrowing target by December 2025. This raises questions about fiscal management and future borrowing limits under the Fiscal Responsibility and Budget Management Act.
Key Takeaways
- The West Bengal government is set to exhaust 95% of its borrowing target by December.
- Total borrowing for the last quarter is Rs 29,000 crore.
- Projected total debt by December 31 is Rs 78,000 crore.
- Debt repayment for 2025-26 is estimated at Rs 32,732.08 crore.
- Challenges include high expenditures and limited revenue sources.
Kolkata, Oct 10 (NationPress) The West Bengal government is poised to utilize 95% of its market borrowing target for the financial year 2025-26 by December this year.
According to sources within the finance department, the state plans to borrow Rs 29,000 crore from the market during the last three months of 2025, with the largest portion of Rs 15,000 crore slated for December, followed by Rs 11,000 crore in November and Rs 3,000 crore in October.
By the end of September 30, 2025, the state has already borrowed Rs 49,000 crore from the market. With the projected borrowing of Rs 29,000 crore in the final quarter, the total debt will reach Rs 78,000 crore by December 31, 2025.
This indicates that the government will have nearly 95% of its targeted market borrowing of Rs 81,972.33 crore accounted for by the end of December.
Consequently, in the fiscal months of January, February, and March 2026, the state government will have less than Rs 4,000 crore available for borrowing unless it opts to exceed the limits established under the Fiscal Responsibility and Budget Management (FRBM) Act.
The FRBM Act imposes restrictions on the overall debt and net debt, capping them at a specific percentage of the Gross State Domestic Product (GSDP).
According to budget documents for 2025-26, the West Bengal government anticipates concluding the fiscal year with a total debt of approximately Rs 7.72 lakh crore, reflecting a 9.21% increase from the Rs 6,30,783.50 crore recorded on March 31, 2025, according to revised estimates for 2024-25.
Interestingly, at the close of the financial year 2010-11, which marked the end of the previous Left Front government, the total debt was just over Rs 1.90 lakh crore.
The projected total debt repayment for 2025-26 is estimated at Rs 32,732.08 crore, slightly up from Rs 31,013.45 crore in revised estimates for 2024-25.
Economists believe that such anticipated debt figures are unavoidable in light of the lack of substantial proposals for increasing state tax revenue, juxtaposed with significant expenditures on various social welfare and subsidy schemes.
The challenge of managing soaring revenue expenditures alongside limited state tax revenue generation avenues is a daunting task, according to economists.
Point of View
The West Bengal government's financial strategies raise critical questions about sustainability and fiscal responsibility. Balancing high expenditures with limited revenue generation capabilities poses significant challenges. As we monitor these developments, the importance of transparent and effective governance cannot be overstated.
NationPress
10/10/2025
Frequently Asked Questions
What is the market borrowing target for West Bengal in 2025-26?
The market borrowing target for West Bengal in the fiscal year 2025-26 is Rs 81,972.33 crore.
How much will the West Bengal government borrow in December?
The West Bengal government plans to borrow Rs 15,000 crore in December, the highest amount for the last quarter of the fiscal year.
What is the impact of the FRBM Act on borrowing?
The FRBM Act sets limits on the total debt and net debt of the state, which restricts borrowing beyond a certain percentage of the Gross State Domestic Product (GSDP).
What will the total debt be by December 31, 2025?
The total debt of the West Bengal government is expected to reach Rs 78,000 crore by December 31, 2025.
What are the challenges facing the West Bengal government?
The West Bengal government faces challenges of high revenue expenditures and limited avenues for generating state tax revenue.
