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.
This will be driven by Fiscal Deficit arising on account of higher capital spending in various programmes of the State Government.
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 guarantees do not constitute a part of the State Government’s loan, but in case of default by the State PSUs, the State Government is liable to repay the loan. The guaranteed loan as a Percentage of Revenue Receipts has been reduced from 123.37 percent in 2001-2002 to 6.3% during 2022-23 against the ceiling of 80 percent.