Bhopal, February 18, 2026: On the eve of presenting the Madhya Pradesh Budget 2026, the state government raised a fresh loan of ₹5,600 crore, pushing the total state debt to ₹4.90 lakh crore, exceeding the 2025-26 budget size of ₹4.21 lakh crore. Despite the rising debt, the state’s economic survey projects a growth rate of 8.04%, indicating underlying economic strength.
Economic Survey and Debt Overview
Deputy Chief Minister Jagdish Devda presented the state’s economic survey in the Assembly on Tuesday, highlighting that the government’s borrowing in any year has not exceeded limits set by the Reserve Bank of India (RBI). The report notes that the debt-to-GSDP ratio declined from 39.5% in 2004-05 to 27.99% in 2023-24, though it may rise to 31.30% in 2025-26. The survey also projects a decline in the average interest rate on outstanding loans, from 7.28% in March 2024 to 7.11% in March 2025, reducing the debt servicing burden.
Fiscal Management and Future Outlook
The survey credits prudent fiscal policies for keeping the state’s financial deficit under control, except during the COVID-19 pandemic in 2019-20. Revenue collections and the state’s share of central taxes are expected to increase in 2025-26, maintaining a revenue surplus and healthy fiscal management.
Loan Summary for FY 2025-26
Including the latest ₹5,600 crore, Madhya Pradesh’s total borrowing for 2025-26 has crossed ₹70,000 crore, with the overall debt now standing at ₹4.90 lakh crore. A supplementary budget has also been passed to meet ongoing expenditure for the current fiscal year.
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