Sun Jan 12 21:59:00 UTC 2025: ## Karnataka’s Mounting Debt: Interest Payments Exceed Budget Projections
**Hyderabad, January 13, 2025** – The state of Karnataka is facing a significant financial challenge, with interest payments drastically exceeding budget projections for the current fiscal year. By the end of November, the state had already paid ₹17,080 crore in interest, reaching 96.34% of the budgeted ₹17,729 crore. This translates to approximately ₹2,000 crore in monthly interest payments, and with four months remaining in the fiscal year, the total expenditure is expected to far surpass the initial budget.
The state’s total receipts through November reached only ₹1.41 lakh crore, just over 50% of the budgeted ₹2.74 lakh crore. While revenue receipts stood at ₹1.03 lakh crore, a significant portion of capital receipts (₹37,878 crore) came from borrowings and other liabilities. Both non-tax revenue and grants-in-aid fell significantly short of expectations.
Despite impressive revenue from State Excise duties (₹12,364 crore) and the state’s share of Central taxes (₹11,472 crore), the state incurred a revenue deficit of ₹14,288 crore, contrasting sharply with the budgeted surplus of ₹297 crore. The fiscal deficit reached ₹37,850 crore, and the primary deficit stood at ₹20,769 crore, representing 65.88% of the budgeted amount. These figures raise serious concerns about Karnataka’s financial stability and its ability to meet its budgetary commitments.
First Piper 