India’s Fiscal Snapshot: Centre Collects ₹30.78 Lakh Crore in FY25, Spends ₹46.55 Lakh Crore

Image Source: finimize.com

India’s provisional government accounts for FY25 reveal that the Centre has received ₹30.78 lakh crore in total revenue, while spending ₹46.55 lakh crore, marking 98.7% of the revised estimates (RE). The data highlights strong tax collections, higher state devolution, and continued fiscal pressures from subsidies and interest payments.

Revenue Collection:

The Centre’s net tax revenue stood at ₹24.99 lakh crore, with non-tax revenue at ₹5.38 lakh crore.
Non-debt capital receipts amounted to ₹41,818 crore, including ₹24,616 crore from loan recoveries and ₹17,202 crore from miscellaneous capital receipts.

State Devolution:

The government transferred ₹12.87 lakh crore to states, ₹1.57 lakh crore higher than FY24, reinforcing strong fiscal federalism.

Expenditure Breakdown:

Revenue expenditure: ₹36.04 lakh crore, including ₹11.16 lakh crore for interest payments and ₹3.88 lakh crore for major subsidies.
Capital expenditure: ₹10.52 lakh crore, exceeding the RE of ₹10.18 lakh crore, signaling higher infrastructure spending.

Fiscal Deficit Management:

The fiscal deficit stood at ₹15.77 lakh crore, aligning with the 4.8% target of GDP.
Higher-than-expected capital spending helped offset shortfalls in revenue receipts.

Economic Outlook:

Analysts suggest that India’s fiscal deficit-to-GDP ratio could be contained at 4.4% in FY26, aided by higher nominal GDP growth and RBI’s surplus transfer.
India’s fiscal performance in FY25 reflects strong revenue collection and disciplined spending, despite pressures from subsidies and interest payments.

Source: Business World, The Hindu Business Line, and New Indian Express.