The debt level of Odisha is now within stipulated limit and it is expected to increase by 4% by the end of financial year 2026-27, according to a status paper published by the Odisha Finance Department on .
As per the report, the total outstanding public debt of the State as per the revised estimate for the financial year 2022-23 stood at Rs 97,037 crore which is 12.7% of the States Gross Domestic Product (GSDP). Over the next three years, total public debt is expected to increase to approximately 16.7% of GSDP in 2026-27, which will be within the stipulated limit of 25%.
The Fifteenth Finance Commission and Odisha FRBM Act, 2005 prescribe for limiting the debt to GSDP ratio within 25%. The current debt level of Odisha is within the stipulated debt limit. Besides, the debt stock is considerably lower than that of the Central Government which is 57% of GDP as per the Union Budget.
The Government has expected that the total debt stock will increase to Rs 1,12,882 crore by the end of FY 2023-24 and again it will go up to Rs 1.40 lakh crore in 2024-25, Rs 1.72 lakh crore by 2025-26 and may rise to Rs 2.09 lakh crore by the end of 2026-27.
The Odisha Government has not resorted to open market borrowing during 2022-23 because of funds from other low cost sources like the Odisha Mineral Bearing Areas Development Corporation (OMBADC) and Compensatory Afforestation Fund Management and Planning Authority (CAMPA).
The loan from these dedicated funds is available at interest rates 2 to 2.5% lower than the open market borrowing (OMB). The State Government can borrow up to 60 percent of the surplus fund available in these funds.
The open market borrowing stood at Rs 24,058.07 crore. As per 2022-23 revised estimate, the share of open market borrowing in total debt of the State is around 24.8%. The share of the open market borrowing has gone down from 30% in FY 2021-22 to 24.8% in FY 2022-23 and is expected to decrease further in the coming financial year.