Bhubaneswar: The mounting debt burden of Odisha has become a matter of growing concern, with projections indicating that the state’s total loan amount could soon cross the milestone of 1.5 lakh crore rupees.
Historical data shows a steady upward trajectory in the state’s liabilities over the decades. Back in 1995-96, Odisha’s debt burden stood at 9,218 crore and 50 lakh rupees, which escalated to 21,001 crore and 88 lakh rupees by 2000-01. Continuing this rising trend, the debt burden climbed to 37,570 crore and 89 lakh rupees by 2013-14.
According to official figures and estimates from the Finance Department, the debt is expected to touch 1,48,187 crore and 82 lakh rupees by the end of the current financial year on March 31, 2027. Economists express apprehension that if this current pace continues, the overall debt load could surpass 1.5 lakh crore rupees by June 2027 and potentially scale past 2.5 lakh crore rupees by 2036.
Defending the fiscal position, the state government maintains that the debt remains within manageable limits relative to the Gross State Domestic Product (GSDP) as mandated by the Fiscal Responsibility and Budget Management (FRBM) Act. Although Odisha has claimed revenue-surplus status since 2005-06, the absolute volume of borrowing has continued to expand year after year.
Financial records indicate that during 2024-25, the state government borrowed 46,820 crore and 93 lakh rupees while making repayments amounting to 39,943 crore and 54 lakh rupees, resulting in a net increase of 16,877 crore and 39 lakh rupees in the debt pool. Similarly, in 2025-26, the state raised 31,455 crore rupees against a repayment of 21,748 crore and 90 lakh rupees, adding 9,706 crore and 10 lakh rupees to the liability.
Data furnished during the monsoon session of the State Legislative Assembly reveals that in the first five months of the 2026-27 financial year up to August, the government borrowed 11,077 crore and 79 lakh rupees and repaid 6,873 crore and 5 lakh rupees, expanding the debt burden by 4,204 crore and 74 lakh rupees during this period.
Open market borrowings constitute the largest share of these funds. The state secured 20,780 crore rupees from the open market in 2024-25 and 11,000 crore rupees in 2025-26, followed by another 5,000 crore rupees during the first five months of the current fiscal year.
With borrowing occupying a prominent place in state budget receipts, economic analysts note that while average per capita income figures are reported to be rising, wide disparities persist between the rich and the poor. The average per capita debt burden of the state is estimated to reach 31,444 rupees and 59 paisa by the end of the current financial year.
Against the backdrop of national debt crossing 200 lakh crore rupees, economists emphasize that the state’s march toward a 1.5 lakh crore rupee debt ceiling poses unique challenges, urging tighter fiscal prudence, expenditure rationalization, and focused efforts on enhancing sustainable incomes for the state and its people.