Most state governments have been executing a tight ship, with their expenses much higher than their income, resulting in large deficits and loans. But curiously, many states have also increased their tenure of the law of the Central Government. Heroes ₹ 65,912 million rupees in Treasury invoices at the end of February 2024. This increased to ₹ 1,17,356 million rupees for February 2025, marking an increase of 78 percent.
According to the Bank of the Reserve of India (RBI), the Treasury Law projects are short -term debt instruments issued by the Indian government in three tenors: 91 days, 182 days and 364 days. These are ideal for money parking for short durations, since the risk is minimal here due to the sovereign guarantee. As a result of this increase, the heroes state governments of 20.11 percent of the total issues of Treasury Law in December 2024. The action has doubled more than 9.26 percent in December 2023.
State governments have also contributed central government values between 5 and 40 years. These are long -term investments. The investments of the states in these values also registered an increase of ₹ 567 million rupees in February 2024 to ₹ 20,802 million rupees in February 2025. But most of these purchases were made by Odisha.
What states did they buy treasure invoices?
RBI data indicates that Karnataka had the most treasury invoices in February 2025, to ₹ 29,966 million rupees. Uttar Pradesh then comes with an investment of ₹ 25000 million rupees and followed by Bihar with ₹ 20,000 million rupees. It is well documented that most states are slow with their Capex expenses in fiscal year 2015 due to Lok Sabha and the numerous state elections. As the policy formulation reached a logjam, states seem to be more effective, which is parked in the short -term treasure values.
Odisha is the only state that is also invested in a defamation of values dated ₹ 20,802 million rupees. This indicates the comfortable fiscal position of the State. The State had a revenue surplus of almost ₹ 27,000 million rupees in fiscal year 2015.
Karnataka had the greatest participation of treasure values in February 2024 also to ₹ 26,193 million rupees. He was followed by Odisha, Rajasthan and Gujarat.
Why the Treasury invoices?
The increase in treasure values held by states could indicate two things. One, are planning to spend in capital or other expression for a period and, therefore, have surplus funds. These are being implemented in treasure values.
Two, states are improving in treasure operations. Instead of letting the inactive money in the bank be deploying it in short -term governmental values, which gives them a good interest rate. The states, including Uttar Pradesh, Bihar and Chhattisgarh, registered a strong improvement in their treasure security this year.
Posted on May 6, 2025
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