NEW DELHI: The Delhi government has set up a consolidated sinking fund (CSF) to redeem its outstanding liabilities, including debt repayment, officials said on Friday.
The fund is to be utilised from the current financial year. It will not be utilised for any purpose other than redemption of the outstanding liabilities, they said. A sinking fund refers to a monetary reserve created by a government or any other agency to dispose of its long-term liabilities.
According to an economic survey report, Delhi’s outstanding debt by March 2025 stood at Rs 30,556.54 crore. It included the non-plan loan received during 2013-14 from the Centre for meeting the outstanding liabilities of the Delhi Vidyut Board and Electricity Supply Undertaking, which was Rs 3,326.39 crore, and the Chandrawal Water Treatment Plant amount of Rs 447 crore.
The outstanding liabilities are defined to comprise both internal debt and public account liabilities of the government. The outstanding debt in 2025-26 was around 2.3% of the Gross State Domestic Product. Delhi’s outstanding liabilities and debt levels remain very low and well under control, historically hovering around 4-5 per cent of its GSDP.
According to a gazette notification, the government will be able to avail of a short-term special drawing facility from the RBI against collateral of investment made in fund for meeting temporary cash-flow mismatches, subject to terms and conditions as fixed by the bank from time to time.
The government will make “conscious efforts” for building up the CSF corpus to 5% of the outstanding liabilities within a span of five years.