Delhi to prudently handle social welfare schemes, capex to widen fisc

The Rekha Gupta government proposed a 32 per cent rise in expenditure to Rs one trillion in FY 26 with the share of capital expenditure expected to rise to 28 per cent from 21 per cent in FY 25 (RE)

The Bharatiya Janata Party (BJP) government in Delhi does not expect the revenue surplus position to be significantly affected by its social welfare schemes.

 

This comes even as the fiscal deficit is likely to widen to a 10-year high in 2025-26 due to a surge in expenditure for asset generation.

 

Even then, the state’s fiscal deficit may remain below one per cent of the gross state domestic product (GSDP) against the statutory ceiling of three per cent.

 

In absolute terms, the fiscal deficit is proposed to rise by around 800 per cent to about ₹13,703 crore in the Budget Estimates (BE) of the next financial year. This is against ₹1,524 crore in the revised estimates (RE) of the current financial year.

 

This was largely due to almost doubling of capital expenditure (capex), pegged at ₹28,115 crore in FY26 (BE).

 

The Rekha Gupta government proposed a 32 per cent rise in expenditure to ₹1 trillion for FY 26. The share of capital expenditure is expected to rise to 28 per cent from 21 per cent in FY 25 (RE).

 

As a consequence, revenue expenditure is estimated to fall to 72 per cent from 79 per cent over this period.

 

The government proposes to utilise the capex to build 60 new CM Shri schools, improve road and bridge infrastructure and boost the public transport system by deploying more than 5,000 electric buses. Other major expenses would be to clean the Yamuna, address the waterlogging and poor drainage and provide better primary healthcare.

 

The government is confident of maintaining a revenue surplus at around 0.67 per cent of GSDP for FY26. This is despite the monthly assistance of ₹2,500 to eligible women, increasing pension for senior citizens and other vulnerable sections and a top-up scheme for PM Kisan.

 

Share of the government’s own tax revenue (OTR) in revenue receipts is estimated to fall to 84 per cent in FY26 from 95 per cent in FY25.

 

The dwindling share is estimated to be made up by expected robust non-tax revenues which would contribute 16 per cent of revenue receipts in 2025-26 (BE) from 6 per cent in FY25 (RE).

 

Besides, the share of grant-in-aid from the BJP-led Union government in revenue receipts is slated to more than double to around 15 per cent from seven per cent over this period.