A fresh report by the Comptroller and Auditor General (CAG) has flagged persistent fiscal mismanagement in Rajasthan, revealing that the state's fiscal deficit breached prescribed limits for the overwhelming majority of the 12-year period between 2015-16 and 2024-25 — spanning the administrations of Vasundhara Raje, Ashok Gehlot, and the current Bhajan Lal Sharma government. The findings underscore a structural fiscal challenge that has outlasted multiple political regimes.

Deficit Trends Across a Decade

According to the CAG report, Rajasthan's fiscal deficit stood at a high of 9.25 percent of GSDP in 2015-16, before moderating to 6.09 percent in 2016-17 and 3.04 percent in 2017-18. It subsequently remained above the 3 percent benchmark in every subsequent year covered, spiking to 5.83 percent in 2020-21 — a year marked by pandemic-driven expenditure pressures — before gradually easing.

The deficit was recorded at 4.31 percent in 2023-24 and 4.25 percent in 2024-25. The state's revised estimate for 2025-26 projects the deficit at 3.89 percent, while the 2026-27 budget estimate puts it at 3.69 percent. Medium-term projections indicate a further gradual reduction to 3.49 percent in 2027-28 and 3.29 percent in 2028-29 — still above the FRBM-mandated ceiling.

Revenue Management and Central Dependence

The CAG report also highlights weaknesses in revenue management. Although revenue receipts increased over the period, they consistently fell short of budget estimates. Rajasthan has remained heavily dependent on transfers and support from the Centre, raising questions about the state's fiscal self-sufficiency.

Under the Fiscal Responsibility and Budget Management (FRBM) framework, the objective was to eliminate the revenue deficit and bring the fiscal deficit below 3 percent of GSDP. Rajasthan achieved a revenue surplus only in 2011-12 and 2012-13; thereafter, the state reverted to deficit, increasing its reliance on borrowing to finance routine expenditure — a pattern the CAG describes as structurally concerning.

Key CAG Recommendations

The CAG has outlined a series of corrective measures. It has called on the Finance Department to establish a quarterly revenue forecasting review mechanism to sharpen estimates of the state's own-tax revenue. The report also recommends department-wise scrutiny of revised budget estimates, with corrective action prioritised wherever gaps are identified.

Among other recommendations, the CAG has suggested creating a dedicated fund for pension payments under the Old Pension Scheme (OPS), developing a dashboard to track department-wise grants, and introducing outcome-based monitoring for major revenue expenditure heads. The report further urges the state to restructure its debt to reduce the interest burden and to ensure that cess collections are deposited into designated government accounts on time.

Borrowing Pattern Under Scrutiny

A particularly pointed observation in the report concerns the use of borrowed funds. The CAG has stressed that borrowings should primarily be deployed to create capital assets rather than finance routine revenue expenditure. Directing borrowed money toward productive infrastructure, the report argues, would ensure that debt contributes to long-term development rather than merely sustaining day-to-day government operations.

What the Findings Signal

Taken together, the CAG's data present a picture of a fiscal challenge that is systemic rather than partisan. The deficit has breached benchmarks both in budget estimates and in actual outcomes across governments of different political persuasions. With Rajasthan's medium-term projections still above the 3 percent FRBM ceiling through 2028-29, the path to fiscal consolidation remains long — and the CAG's recommendations, if implemented, will test the resolve of the current administration as much as its predecessors.