The Comptroller and Auditor General’s report tabled in the Telangana Assembly on Monday painted a picture of strained public finances in the state during 2024-25, marked by underutilization of budget, poor revenue mobilization, rising debt and irregularities in tax administration.
The report noted that while the government was able to keep the fiscal deficit broadly within expected levels through borrowing, the widening revenue deficit and increasing debt burden could remain a source of concern for the state’s financial sustainability.
According to the report, the Telangana government was unable to utilize its budget in line with the targets set for the financial year 2024-25, as it spent only $2,18,251 Crore Vs $Rs 2,74,058 crore is expected in the budget under revenue and capital expenditure, which amounts to 80%.
Within the framework of revenue expenditure, the government has estimated spending $2,20,945 crores, but the actual expenditure was 2,20,945 crores $1,77,224 crore, which is also around 80% of the estimates.
In contrast, within the framework of capital expenditure, the government proposed spending $33,487 crore, but ended up overspending by 108%, totaling Rs 33,487 crore. $Rs 36,072 crore has been spent in the current financial year.
The report also indicated that the government had expected $17,730 crore towards interest payment obligations in the year. However, the actual burden was much higher, as the state paid $Rs 27,803 crore.
Likewise, under the draft law on salaries and allowances for government employees, the government has allocated the budget $28,093 crores, but had to be spent $30,277 crore, which leaves little room for development and social welfare spending.
The CAG also pointed out the severe shortfall in revenue receipts. The state was expecting $2,21,242 crore revenue receipts, but the actual collection stood at Rs 2,21,242 crore. $1,67,804 crores, 76% of estimates.
The shortfall was particularly acute in non-tax revenues and grants expected from the Centre. Within the framework of non-tax revenues, the government expected to collect $35,208 crores, but it was only achieved $23,608 crores or 67% of the estimates.
Likewise, the state was expecting to receive $21,636 crore in grants from the central government, but it actually received only 37% of that amount. $7,913 crores.
The government had originally expected revenue receipts to exceed revenue expenditures, resulting in a modest revenue surplus of $297 Crores. However, the state ended up with a revenue shortfall of $9,420 crores.
At the same time, the state estimated the fiscal deficit at approximately $Rs 49,256 crore. The actual fiscal deficit was found to be $48,922 crore, broadly in line with expectations. The government closed this deficit by raising… $48,922 crore through open market loans.
The state collected a total, the report said $65,537 crore from open market loans during 2024-25. This number is included $ 5,842 crore of unpaid legacy Ways and Means of Advancement (WMA). As a result, the total debt owed by the state increased to $4,47,493 crore by the end of the financial year 2024-25.
The CAG noted that the state has issued guarantees for loans worth up to… $57,305 crore during the year, bringing the total secured debt to $2,41,528 crores.
The state also borrowed $759 crore from institutions like LIC, GIC and NABARD. Moreover, within the framework of ways and means of advances, which are usually provided to meet short-term liquidity needs, the state borrowed $1,29,376 crores and its repayment $1,24,534 crores during the year.
