BHUBANESWAR: The debt burden on the state will reach around Rs 3.11 lakh crore by the end of 2030-31, according to the latest status paper on public debt in Odisha.
The status paper released by the state government said over the next three years, total public debt is expected to increase from 13.1 per cent of the GSDP in 2025-26 financial year to approximately 17.9 per cent of the GSDP in 2030-31. The debt stock will increase because of the higher capital spending on various programmes of the government.
Official sources said as the share of central taxes besides the state’s own tax and non-taxes are unlikely to match spending on different schemes announced by the government, the total debt stock by the end of 2026-27 has been estimated at Rs 1.55 lakh crore. This will include the open market borrowing of Rs 68,000 crore to be incurred by the state government during 2026-27 to fund different schemes.
However, the status paper said at present the future debt outlook of the state looks stable. It also depends on the policy priorities of the state government. The debt will grow but will be within the permissible limit, the paper stated.
The per capita debt of Odisha of Rs 25,778 is one of the lowest in the country among the bigger states. In the past, Odisha has seen unsustainable debt levels at 50 per cent of GSDP, servicing of which was about 34 per cent of revenue receipts. The paper maintained that after the implementation of FRBM Act 2005, debt has been restrained and debt servicing curtailed.
Due to many low-cost borrowings, debt servicing has decreased. As per the actual account of 2025-26 financial year interest payment to revenue receipts (IPRR) is 3.4 per cent which is estimated to further come down to 3.3 per cent in 2026-27. It is projected that IPRR will remain at 3.4 per cent in 2030-31, which is much less than the stipulated limit of 15 per cent.
The status paper maintained that Odisha’s fiscal discipline has been the key to maintaining low fiscal deficits, a good debt profile, and an above-average capital outlay/GSDP ratio. The debt limit has been prescribed in the FRBM Act should be within 25 per cent. The debt to GSDP ratio is estimated at 14.1 per cent and 15 per cent in 2026-27 and 2027-28 respectively.
On the other hand, IPRR has also declined steadily over the years to 3.4 per cent in 2025-26 and 3.3 per cent in 2026-27, it added.