Opinion: Bharat's States Must Revamp Public Financial Management
Loading more articles...
Bharat's States Need Urgent Financial Reset for Sustainable Growth
N
News18•28-02-2026, 11:27
Bharat's States Need Urgent Financial Reset for Sustainable Growth
•States account for two-thirds of public expenditure, driving health, education, and infrastructure.
•Widening fiscal divergence among states; some face sustained revenue deficits and high debt burdens.
•RBI notes aggregate gross fiscal deficits remain near 3% of GSDP for many states, with liabilities at 28-30% of GSDP.
•Weak Public Financial Management (PFM) systems lead to optimistic revenue projections, opaque off-budget borrowings, and rising contingent liabilities.
•Key reforms include credible Medium-Term Fiscal Plans, non-negotiable transparency, modernizing revenue mobilization, and aligning capital expenditure with fiscal plans.
