Maharashtra Chief Minister Devendra Fadnavis Wednesday asserted that the state’s finances remain stable despite a rise in borrowings, expressing confidence that Maharashtra will become the first $1 trillion economy in the country while announcing that electricity tariffs are expected to decline over the next five years.
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Replying to the debate on the state budget in the Assembly, Fadnavis said the state’s economic expansion must be viewed alongside the increase in debt, as both have grown significantly over the past decade.
According to him, Maharashtra’s outstanding debt has risen from about Rs 3 lakh crore in 2013-14 to Rs 9.32 lakh crore, but during the same period, the state’s Gross State Domestic Product (GSDP) has expanded from around Rs 16 lakh crore to Rs 51 lakh crore.
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The CM said the debt-to-GSDP ratio stands at around 18 per cent, which is lower than that of several other states, including Telangana, Karnataka, Andhra Pradesh, Kerala and Tamil Nadu.
Maintaining that the state still has borrowing capacity, Fadnavis said the key issue is ensuring that funds raised through borrowings are used for productive capital expenditure.
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He rejected the Opposition’s allegations that welfare spending has weakened the Maharashtra’s finances, saying schemes such as the Ladki Bahin and free electricity for farmers have been implemented while maintaining fiscal discipline.
The fiscal deficit currently stands at around 2.78 per cent of the GSDP, while the revenue deficit is about one per cent, he said.
Electricity tariffs
On electricity tariffs, Fadnavis said the government has taken steps to keep power costs low. Tariffs for households consuming 0–100 units are expected to decline by about 24 per cent over the next five years, while the average tariff is projected to fall by around 1.2 per cent annually.
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He said Maharashtra’s electricity generation capacity currently stands at about 45,000 MW and is expected to increase to 82,000 MW by 2030, adding that contingency plans are in place to ensure an uninterrupted supply even if some projects face delays.
Industrial power consumption in the state grew by around 8 per cent last year, which is higher than the national average, he said.
Highlighting the state’s push for renewable energy, Fadnavis said the share of non-conventional sources in electricity generation is expected to reach 52 per cent by 2030 and 65 per cent by 2035.
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The government is also developing battery-based storage systems for green energy, for which Rs 1,650 crore has been allocated in the budget, while private investment of about Rs 3.12 lakh crore is expected in the sector.
Fadnavis said Maharashtra’s economy is currently estimated at about $660 billion and expressed confidence that the state will become the country’s first trillion-dollar economy in the coming years.
