Bhubaneswar, March 31 (IANS) The Comptroller and Auditor General of India (CAG) said on Tuesday that Odisha posted moderate growth in 2024–25 compared to the previous financial year, while cautioning against fiscal stress risks arising from the under-realisation of revenue receipts, low own-tax mobilisation, poor dividend collection, long-outstanding loans, and concentrated short- to medium-term repayment obligations.

The State Finances Audit Report of the Odisha government for 2024–25, presented in the State Assembly, noted that the state’s overall fiscal position remained stable, with controlled deficits, manageable debt, and a sustained revenue surplus.

However, the report flagged fiscal risks owing to different factors saying that, if left unaddressed, could seriously constrain the state’s capacity for developmental and capital spending.

It highlighted that Odisha’s economy recorded moderate growth (11.4 per cent) in FY 2024-25 compared to previous year.

Similarly, Gross State Domestic Product (GSDP) at current prices grew at a compound annual growth rate of 13.3 per cent from Rs 5,40,185 crore in 2020-21 to Rs 8,90,038 crore in 2024-25.

According to the report, in 2024–25, the state recorded a revenue surplus of Rs 22,651 crore (2.54 per cent of GSDP).

The fiscal deficit stood at Rs 25,042 crore (2.81 per cent of GSDP), remaining well within the stipulated ceiling of three per cent of GSDP.

Total liabilities were at 15.48 per cent of GSDP, significantly below the prescribed limit of 25 per cent.

The CAG flagged that although revenue receipts (Rs 1,83,963 crore) grew by 2.43 per cent in 2024–25, revenue buoyancy and the state’s own tax buoyancy declined to 0.21 per cent and 0.02 per cent, respectively, indicating that revenue generation is not keeping pace with economic growth.

This highlights a serious weakness in the state’s tax mobilisation capacity.

The report also raises concern of rising subsidy expenditure, which increased sharply to Rs 9,134 crore in 2024-25, exceeding the budget estimate of Rs 8,068 crore and rising by Rs 5,011 crore (121.54 per cent) over the previous year due to flagship welfare schemes.

Another concern raised in the report is the non-remittance of dividends by the State Public Sector Enterprises.

“As per State’s dividend policy, State Public Sector Undertakings (SPSUs) had to pay an annual dividend to the state government calculated as 30 per cent of either the Profit After Tax (PAT) or the state government’s equity, whichever is higher. It was however, found that 27 SPSUs, despite reporting PAT, did not remit Rs 5,146.76 crore of the required dividends to the State government as mandated by the Finance Department,” the report noted.

The report also added that a high concentration of liabilities, Rs 76,642 crore (56 per cent) due within the next seven years — poses refinancing and liquidity pressures on the state budget.

While debt sustainability improved until 2022–23, it weakened thereafter due to rising debt and persistent primary deficits, underscoring the need for fiscal prudence and alignment of debt growth with GSDP to ensure long-term sustainability.

The CAG indicated to inaccurate assessment of requirements and inadequate utilisation capacity for the provisions made in the annual budget.

Audit observed instances of inflated provisions, erroneous proposals, arbitrary enhancements without justification, unrealistic budgeting, and unnecessary supplementary allocations, leading to persistent underutilisation and surrender of funds.

–IANS

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