By Sampurna Majumder
The Comptroller and Auditor General has identified increasing and significant stress on the budgets, with salary bills increasing 2.5 times in a decade to Rs. 16.6 crore in 2022-2023, and spending on incentives tripled to ₹3.09 lakh crore. States’ public debt increased 3.4 times to ₹59.6 lakh crore, or around 23% of their combined GSDP, based on the State Finances Publication 2025.
In FY 2022-2023, salaries formed the largest component of the spending. Approximately 43.49% of the total revenue expenditures were committed by states to investing in salaries, interest payments, and pensions, which contributed to a significant amount of their budget. The primary portion of this expenditure was on salaries.
The expenditure on salaries, pensions, and interest payments varied widely in terms of percentage of revenue expenditure. While Nagaland scored as high as 74%, Maharashtra scored only 32%. 15 states reported using 50% of their revenue in 2022-2023, seven states between 40% and 50%, and six states below 40%.
Committed expenses made up 63% of revenue expenditures in Kerala, 51% in Tamil Nadu, 42% in Andhra Pradesh, 41% in Telangana, and 33% in Karnataka, respectively, in the Southern states.
8.61% of state revenue expenses have gone to subsidy spending, which is defined as spending on regular government operations and amenities to generate new assets or strengthen existing ones.
Four states like Andhra Pradesh, Gujarat, Punjab and Rajasthan, have invested more than 10% of their total profit in subsidies in 2022-23. Punjab spent around 17%, contrasting the fact that the remaining subsidies represented 2% of total expenditure in ten states: Sikkim, Meghalaya, Nagaland, Uttarakhand, Manipur, Tripura, Kerala, Goa and Assam. No expenditures were reported by Arunachal Pradesh.
According to the reports, the paper also showed that the committed expenditure and subsidies altogether exceeded states’ own tax collection by 102% in 2013-14 and 134% in 2020-2021.
The total public debt of all 28 states as of March 31, 2023, amounted to Rs 59.6 lakh crore, or almost 23% of their combined gross state output.