HYDERABAD: Telangana’s financial performance for the first two months of the fiscal year (April-May 2025) reflects a mixed picture-moderate revenue inflows on one hand, and early signs of fiscal strain on the other. By the end of May, the state reported earnings of ₹23,425 crore, which amounts to 10.2% of the ₹2.29 lakh crore projected in the state’s annual budget. According to provisional data submitted to the Comptroller and Auditor General (CAG), the overall revenue expenditure stood at ₹28,463 crore, or 12.5% of ₹2.26 lakh crore estimated for the year.
Tax revenue, one of the main sources of the state’s income, saw a modest rise, touching ₹22,609 crore-12.9% of the ₹1.75 lakh crore expected for 2025-26. However, a substantial portion of the state’s total receipts came from borrowings, which stood at ₹9,389 crore by May-end. This accounts for 17.39% of the ₹54,009 crore borrowing limit budgeted for the year. The state’s reliance on borrowings in the early part of the fiscal year and a widening revenue deficit highlight the need for tighter fiscal management and more efficient revenue mobilisation in the months ahead, experts pointed out.Another area of concern was the subsidy bill, which crossed ₹5,199 crore in just two months-already 31.81% of ₹16,345 crore earmarked in the budget for subsidies.On the deficit front, the state recorded a revenue deficit of ₹5,037 crore, reversing the budgeted expectation of a ₹2,738 crore surplus for the full year. The fiscal deficit too stood at ₹9,389 crore, underlining the state’s growing dependence on debt to fund expenses. The primary deficit-fiscal deficit excluding interest payments-was ₹5,223 crore, indicating an imbalance between income and essential spending.‘Telangana facing slow-moving non-tax income’Revenue from key departments showed mixed trends. Stamps and registration collections brought in ₹7,919 crore, significantly behind the annual target of ₹19,087 crore. On a more positive note, excise revenue showed healthy growth, rising from ₹1,288 crore at the end of April to ₹3,060 crore by May, which represents 11.08% of the ₹27,623 crore projected for the year.Taken together, the numbers suggest that while Telangana has made a fair start in revenue generation, it is facing mounting pressure from committed expenditures and slow-moving non-tax income, experts pointed out.
