Mumbai: The Mahayuti government’s first budget after the state assembly elections paints a worrisome picture of Maharashtra’s economy. The state’s debt burden is set to rise to Rs 9.32 lakh crore in fiscal 2025-26, with a massive Rs 3.12 lakh crore allocated for salaries, pensions, and interest payments.
Maharashtra's Debt
Currently, Maharashtra’s debt stands at Rs 7.82 lakh crore which will increase further due to rising financial outgo and interest payments. The state’s revenue income, the backbone of its economy, is projected to be Rs 5.36 lakh crore in 2024-25, rising to approximately Rs 5.61 lakh crore in 2025-26.
However, revenue expenditure, covering salaries, pensions, and administrative costs, is expected to reach Rs 6.06 lakh crore, creating a revenue deficit of Rs 45,891 crore. Of this Rs 6.06 lakh crore expenditure,
■ ₹1.72 lakh crore is for salaries,
■ ₹75,137 crore for pensions,
■ ₹64,659 crore for interest payments. Together, these expenses account for 55.72% of the state’s annual revenue. Breakdown of State Debt
■ Out of the total Rs 9.32 lakh crore debt.
■ ₹7.39 lakh crore is internal debt,
■ ₹80,000 crore comprises loans and advances from the central government. Additionally, Maharashtra has Rs 23,010 crore in off-budget debt for 2024-25, which could be emergency borrowing to meet unforeseen expenses.
There have been speculations that the state took loans to pay employees’ salaries after diverting significant funds to election-related populist schemes. Development vs. Deficit A key concern is the shrinking allocation for development schemes, which will be Rs 93,165 crore in 2025-26—Rs 16,000 crore less than the Rs 1.09 lakh crore allocated in the current year.
The overall fiscal deficit for 2025-26 is projected at Rs 1.36 lakh crore, with the budget showing a Rs 451 crore deficit. Maharashtra is set to spend 11.53% of its total budget on servicing its debt—higher than the 10.60% in 2023-24 and 10.19% in 2024-25. The budget highlights the state’s growing financial strain, with rising debt and expenditure overshadowing revenue growth.
