Department of Expenditure ups states’ additional borrowing ceiling by ₹9.40 lakh crore for FY2024-25

The Department of Expenditure allowed an extra borrowing ceiling of nearly ₹9.40 lakh crore to states in FY2024-25, the Finance Ministry informed on Sunday as part of its FinMin Year Review 2024.

In a post on the social media platform X, the ministry added that the net borrowing ceiling for the states is fixed at 3 per cent of the Gross States Domestic Product (GSDP), i.e., ₹9,39,717 crore for the financial year 2024-25 as per the recommendations of the Fifteenth Finance Commission (XV-FC).

The central government has approved ₹6,83,203 crore for raising Open Market Borrowing (OMB) and ₹62,721.57 crore for availing of negotiated loans during the financial year 2024-25 as of September 30, 2024. Earlier today, the Ministry posted on X that the Department of Expenditure has been consistently improving direct benefit transfer (DBT) linkages between beneficiaries and onboarding with external systems to facilitate greater ease of living.

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The Ministry stated that the DBT through the Public Financial Management System (PFMS) supports Digital India by enabling electronic payment and receipt for ministries and departments in both the centre and the states.

The Ministry added that the IT-based Public Financial Management System (PFMS) makes a direct and significant contribution to the Digital India Initiative of the Government of India, enabling direct benefit transfer for the beneficiaries enrolled in various schemes under ministries/departments in the Government of India. It further added that the DBT through PFMS aims to achieve the complete tracking of the realisation of funds from their release to credit into the bank account of intended beneficiaries and ‘just-in-time’ transfer of funds.

Almost all the Centrally Sponsored Schemes (CSS) and Central Sector Schemes (CS) are on the PFMS, and all the major banks, including the Reserve Bank of India (RBI), have interfaces with PFMS, the Ministry added.