Synopsis
In a significant financial development, the Centre has transferred Rs 11,80,532 crore to state governments in the first 11 months of the fiscal year, surpassing last year's figures by Rs 1,47,099 crore. This increase aims to enhance state capital spending and support welfare initiatives, as reported by the Finance Ministry.Key Takeaways
- Centre allocated Rs 11,80,532 crore to states.
- Increase of Rs 1,47,099 crore over last fiscal year.
- Government aims for 4.4% GDP deficit by 2025-26.
- Total expenditure at Rs 38,93,169 crore.
- Market borrowing of Rs 8 lakh crore planned for H1 2025-26.
New Delhi, March 28 (NationPress) The Centre has allocated Rs 11,80,532 crore to state governments as the devolution of tax share by the Government of India during the first 11 months of the ongoing financial year up to February 2025. This amount is Rs 1,47,099 crore higher than the previous fiscal year (2023-24), as per data disclosed by the Finance Ministry on Friday.
The Centre distributes tax revenue to states based on the recommendations of the Finance Commission. This revenue sharing is designed to empower states to enhance capital spending and support their development and welfare initiatives.
The Government of India has accumulated Rs 25,46,317 crore (80.9 percent of the corresponding RE 2024-25) in Total Receipts up to February 2025, which includes Rs 20,15,634 crore from Tax Revenue (Net to Centre), Rs 4,93,319 crore from Non-Tax Revenue, and Rs 37,364 crore from Non-Debt Capital Receipts.
The total expenditure incurred by the Government of India stands at Rs 38,93,169 crore (82.5 percent of corresponding RE 2024-25), of which Rs 30,81,282 crore is allocated for the Revenue Account and Rs 8,11,887 crore for the Capital Account. Among the Total Revenue Expenditure, Rs 9,52,844 crore is earmarked for Interest Payments and Rs 3,63,005 crore for Major Subsidies, according to the statement.
The data indicates that the fiscal deficit is being maintained effectively as the nation follows a strategy of financial consolidation to promote stable growth while controlling inflation.
Finance Minister Nirmala Sitharaman has set a declining trajectory for the budget deficit target, aiming for 4.4 percent of GDP by 2025-26, down from 4.8 percent of GDP in 2024-25.
The net market borrowing for the budget is established at Rs 11.54 lakh crore, with the remaining funds sourced from small savings schemes, as stated by the Finance Minister during the budget presentation.
The Finance Ministry reported on Thursday that the Government plans to raise Rs 8 lakh crore from the bond market in the first half of 2025-26 (April-September), accounting for 54 percent of the total market borrowing of Rs 14.82 lakh crore for the entire financial year as outlined in the Budget. Of this, Rs 10,000 crore will be generated through sovereign green bonds.
The Centre's market borrowing is structured in phases to prevent liquidity from being drawn away from corporate sector investments, which could negatively impact economic growth.
