Telangana’s public debt is expected to exceed Rs 5 lakh by the end of 2025-26

Telangana’s public debt is expected to exceed 2024-25 by the end of 2025-26. This image is for representation only. |Picture source: Getty Images

Telangana expects outstanding loans, fiscal liability and budget management bills to exceed Rs 5 lakh at the end of the next fiscal year [2025-26]. When debt services payments and liquidation principal increase, it can harm the state’s financial position.

Key updates to Telangana budget 2025-26 presentation

Various loan sources

According to the budget documents for 2025-26, the state’s open market loans are expected to reach Rs 4.07 crore by the end of 2025-26, close to Rs 50,000 crore higher than this year’s current year [2024-25] 358 crore rupees. The state has provided provisions for loans with a total amount of Rs 23,719 crore in central government loans, with loans of Rs 1,122 crore for autonomous institutions. Special securities, provident fund and others are expected to provide an additional Rs 21.787 crore, while the state expects the reserve to be orders of Rs 41,048 crore, totaling Rs 504 crore.

The government said outstanding public debt is within the limits, accounting for 28.1% of GDP. It also divided the outstanding accounting into Rs 301 crore into three categories. Therefore, the government guarantees that the loans raised by the dedicated vehicle (SPV) and provided by the government are Rs 1.17 crore, while the loans raised by the SPV are guaranteed and loans provided by the government and provided by them, and are provided by them, with an estimated Rs 1.24 crore.

Debt service 2024-25 rupees higher than Rs 20 billion

According to documents submitted by the General Assembly at the General Assembly on Wednesday (19 March 2025), the amount of non-guaranteed loans raised and provided by the company is Rs 5.956 crore. The government fixed debt services expenditure in 2025-26 to about Rs 20,000 crore of Rs 19,377 crore, higher than Rs 177,299 crore that year. But given the quantum of accumulated debt, governments have been generating spending on debt services, rather than budget estimates over the past few years.

Interest payment exceeds estimates

For example, during the 2024-25 period, the budget estimates interest payments at Rs 17,729 crore, but more than Rs 22,000 crore have been repaid until the end of January, with two months left.