Gandhinagar, March 23 – Gujarat Finance Minister Kanubhai Desai stated on Monday that the state government is maintaining strict fiscal discipline and meeting all prescribed financial targets, even as it continues to increase capital expenditure for development.
Speaking during the Budget session, Desai said the government is managing finances according to established standards and traditions of good governance.
His comments were in response to concerns raised by senior Congress MLA Shailesh Parmar regarding the state's financial management, including rising non-development expenditure and debt.
Desai explained that the Gujarat Fiscal Responsibility Act, 2005, ensures fiscal stability and accountability, and the state aims to eliminate the revenue deficit or maintain a surplus.
He informed the assembly that the state achieved a revenue surplus of Rs 18,943 crore in 2024-25, Rs 23,725 crore in 2025-26 (revised estimates), and projects a surplus of Rs 25,587 crore for 2026-27.
Addressing concerns about the fiscal deficit, he said it should remain within 3 per cent of the Gross State Domestic Product (GSDP), while Gujarat's fiscal deficit is estimated at 1.97 per cent for 2026-27.
Regarding debt, the minister stated that the limit is 27.10 per cent of GSDP, while Gujarat's debt stood at 13.87 per cent in 2024-25, 14.43 per cent in 2025-26 (revised), and is estimated at 14.65 per cent in 2026-27.
He emphasized that the state's debt is a crucial resource for development projects and capital expenditure. He also stated that the state has never defaulted on debt repayment. Due to effective financial management, Gujarat has not taken any overdrafts for the last 22 financial years and has not taken any advance for the last 21 years.
Desai also informed the assembly that the 2026-27 budget, amounting to Rs 4.08 lakh crore, allocates Rs 1,57,358 crore for capital expenditure, which accounts for 39 per cent of total expenditure, compared to 25.1 per cent in 2021-22.
He further stated that capital expenditure has grown by an average of 28 per cent over the last five years.
Earlier, Congress MLA Shailesh Parmar questioned the balance between developmental and non-developmental spending in the 2026-27 budget, stating that the allocations reflect a rising burden on the state's finances.
Parmar highlighted that Gujarat's per capita income is estimated at Rs 3,01,000, describing the budget as having "two sides like a coin", namely developmental and non-developmental expenditure.
He stated that Rs 2,62,477.41 crore has been allocated towards developmental expenditure, translating to Rs 40,381 per capita for the state's 6.5 crore population. He also noted that the other side of the coin is non-developmental expenditure, which is Rs 1,39,998.93 crore. This means there has been an increase in non-developmental expenditure this time.
Parmar pointed out that while developmental expenditure for 2026-27 has increased by Rs 26,144 crore compared to 2025-26, non-developmental expenditure has also risen by Rs 25,185.84 crore during the same period.
He added that if these figures are examined annually, it seems clear that in the next one or two years, both figures will equalize.
Raising concerns over the state's debt, Parmar stated that it stood at Rs 3,99,363 crore for 2024-25, adding that the government increased debt by Rs 1,094.88 crore every day on average.
He further stated that Rs 28,024.73 crore was paid as interest in 2024-25, amounting to Rs 71.8 crore daily, while Rs 29,086 crore was paid towards the principal.
He said, "Thus, Rs 40,381 is spent per Gujarati on developmental expenditure, while the debt burden per Gujarati is around Rs 61,482."
In his address, Desai said that when GST was implemented in June 2017, the number of taxpayers in the state was 5,08,863, which has increased to 13,82,342 now.
He further stated that the number of taxpayers in the state has increased by more than 172 per cent. Gujarat has been ranked first at the national level for five consecutive years in filing GST returns within the stipulated time limit.
Desai also stated that Gujarat has seen a 13 percent increase in GST revenue this year.
From April-2025 to February-2026, the state government has received a total revenue of Rs 1,15,421 crore including GST, VAT, electricity duty and professional tax, he said.