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Economic Survey calls for fiscal flexibility for the Centre, cautions States against worsening finances
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This, the Survey has argued, is the appropriate strategy for now, and can be revisited after this time period is over.
“It is a concrete commitment with a specific date,” the Survey noted.
Also Read | Economic Survey 2025-26: Key takeaways in chartsState finances deterioratingWhile praising the Centre for its fiscal prudence, the Survey however cautioned State governments against worsening finances.
It added that, between 2023-24 and 2024-25, the revenue deficit increased by 40 basis points across all States.
“A key driver of this renewed fiscal stress has been lagging revenue growth relative to nominal GDP growth, compounded by the incurring of expenditures such as discretionary unconditional cash transfers,” the Survey noted.