Telangana Govt likely to fall short of revenue expenditure in 2025-26 fiscal

Telangana Government is likely to fall short in the expected revenue expenditure during the current financial year (2025-26) on the lines of previous years.

The revenue expenditure of the State till January end was ₹1.48 lakh crore — just 65.62% of the ₹2.26 lakh crore projected in the (2025-26) budget estimates. The expenditure of the remaining two months (February and March) are yet to be released. The situation was no different in the financial year 2024-25 when the State registered revenue expenditure of ₹1.77 lakh crore against the projected ₹2.21 lakh crore, according to the Comptroller and Auditor General of India.

Financial Year 2024-25

The CAG, in its finance accounts report for 2024-25, said the State projected its revenue and capital expenditure at ₹2.74 lakh crore. But it managed to spend ₹2.18 lakh crore, around 80% of the budget estimates. Interestingly, while the State lagged behind in the revenue expenditure, it registered sizeable increase in the capital expenditure during the fiscal.(2024-25). The capital expenditure — which was estimated at ₹33,487 crore — however, crossed ₹36,000 crore mark reaching ₹36,082 crore (109%).

As expected, interest payments, salaries/wages and pension payments exceeded the projections. While the Government budgeted interest payment of ₹17,739 crore during 2024-25, it ended up paying ₹26,688 crore, over ₹9,000 crore more. On the salaries/wages and pensions front, the Government paid ₹42,245 crore and ₹16,950 crore respectively against the ₹40,041 crore and ₹11,649 crore projected in the budget estimates.

One of the main reasons behind the shortfall was the revenue receipts which did not keep pace with the expectations. The State Government had estimated the receipts to the tune of ₹2.21 lakh crore, but ended up with revenue receipts of ₹1.69 lakh crore, while capital receipts in the form of borrowings and other liabilities contributed another ₹49,847 crore. Accruals pertaining to revenue in the form of non-tax revenue and grants-in-aid and contributions belied expectations as the State registered ₹23,607 crore non tax revenue (against ₹35,208 crore projected) and ₹7,913 crore as grants-in-aid and contributions (against ₹21,636 crore projected) leading to a shortfall.

As a result, the State registered revenue deficit of around ₹9,000 crore against the ₹297 crore surplus projected for the fiscal year (2024-25).