RABI NARAYAN JENA
Bhubaneswar: The state’s fiscal deficit in 2025-26 was Rs 23,650.89 crore, as revealed a recent report submitted by Odisha Principal Accountant General (PAG) to the Finance Department. It was marginally lower than the Rs 25,042 crore recorded in 2024-25. On the one hand, the state government is stepping up efforts to put Odisha on the path of rapid development.
Chief Minister Mohan Charan Majhi and his team have been working relentlessly to attract investment, while a detailed roadmap has also been prepared. However, the state’s fiscal position has remained under pressure, partly due to what officials describe as inadequate long-term planning. Odisha’s financial position has shown little improvement. While central grants to the state have been declining year on year, revenue mobilisation from its own sources has also remained lower than expected. As a result, the state’s fiscal deficit has crossed Rs 23,650 crore.
According to the PAG data, revenue collection in 2025-26 fell short of the budget target, while revenue expenditure remained substantial. The state had set a budget target of Rs 2,32,000 crore for revenue collection in 2025-26, but the actual collection stood at Rs 1,96,190.83 crore, or about 85% of the target. In comparison, revenue collection in 2024-25 stood at Rs 1,83,963 crore. Revenue expenditure also increased during the year. Against a budget provision of Rs 2,00,200 crore for 2025-26, the actual expenditure stood at Rs 1,74,405.14 crore, or about 87% of the budget provision. Revenue expenditure in 2024-25 was Rs 1,61,312 crore, indicating an increase of about Rs 13,093 crore in a year.
The difference between revenue receipts and revenue expenditure resulted in a revenue surplus of Rs 21,785.69 crore in 2025-26. However, the state government spent Rs 42,398.35 crore on capital expenditure during the year. Loans and advances extended by the government to others were also taken into account. During the year, the state raised Rs 27,673.04 crore through internal borrowings and loans from the central government, among other sources. It repaid Rs 16,843.49 crore, resulting in a net increase of Rs 10,829.55 crore in public debt.
Similarly, the government extended loans and advances amounting to Rs 3,854.97 crore during the period and recovered Rs 816.74 crore. The net impact of these transactions was also reflected in the state’s fiscal deficit. Thus, despite having a revenue surplus, Odisha’s fiscal deficit reached Rs 23,650.89 crore due to capital expenditure and net loans and advances.
A senior government official said the fiscal deficit could increase further in the coming years if administrative officials fail to utilise budgetary allocations for development programmes, particularly infrastructure creation and strengthening. Notably, Odisha received central grants of Rs 21,011 crore in 2023-24 for various sectors. The amount declined to Rs 17,955 crore in 2024-25 and further to Rs 16,042 crore in 2025-26. The official said the declining flow of central grants was also playing a significant role in the state’s fiscal deficit.
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