Assam's total outstanding liabilities stood at ₹1,61,761 crore as of March 31, 2025, according to Finance Minister Jayanta Malla Baruah's latest statement to the Assembly. This represents a slight increase from the previously reported ₹1.73 lakh crore in 2024-25, but the Debt-to-GSDP ratio remains manageable at 25.7% to 26.8%, staying well below the 32% ceiling prescribed under the Assam Fiscal Responsibility and Budget Management (FRBM) Act. Interest payments on old loans accounted for 9.77% of the State's total revenue receipts during 2024-25, while the government maintains that debt remains within prescribed limits following the AFRBM Amendment Act, 2022.
Assam's fiscal strategy demonstrates a clear shift toward productive capital formation rather than routine expenditure. Capital outlay increased from 3.65% of GSDP in 2023-24 to 4.11% in 2024-25, with medium-term projections maintaining this elevated level at 3.96% in 2025-26 and 3.72% by 2026-27. The revenue deficit, indicating borrowing for current consumption, is declining from 0.46% of GSDP in 2023-24 and is projected to approach zero by 2026-27. This transition from revenue to capital expenditure reflects the state's focus on infrastructure-led growth and long-term development assets.
The mining sector has emerged as a significant revenue contributor, with Mines and Minerals Minister Jayanta Malla Baruah reporting ₹17,823 crore in total revenue generated during the period from 2021-22 to 2025-26. The State earned ₹15,318 crore as royalty from crude oil and coal during the same period, highlighting the substantial contribution of the extractive sector to Assam's revenue base. The government currently operates 188 sand quarries from which the previous administration generated ₹133.65 crore in revenue, with plans to conduct online auctions for another 200 quarries to ensure greater transparency in allocation processes.
Assam's forest cover has shown positive growth, increasing by 208.55 square kilometres since 2017, rising from 28,105 sq km to 28,313.55 sq km, which now constitutes 36.10% of the State's geographical area as per the India State of Forest Report 2023. Between 63% and 88% of saplings planted under compensatory afforestation programmes have survived, indicating effective implementation of forest conservation measures. The government has freed 16,937 hectares of forest land spread across national parks, wildlife sanctuaries and reserved forests from encroachment during the last five years, while continuing compensatory afforestation over 2,561.39 hectares under the CAMPA scheme between 2016-17 and 2025-26.
The analysis emphasizes that Assam's fiscal trajectory presents a balanced picture that extends beyond simplistic debt debates. Key policy priorities include modernizing GST compliance, broadening property tax bases, strengthening land revenue administration, and improving non-tax revenue collection. The state's fiscal strategy demonstrates a commitment to infrastructure-led growth while maintaining adherence to prudent fiscal management, with medium-term projections indicating continued fiscal consolidation without sacrificing development spending. The upcoming budget's success will depend on balancing continued capital investment with stronger revenue mobilization and greater fiscal transparency to ensure sustainable long-term economic growth.
