Odisha had spent only 25.2% of its capital outlay and a third of its overall budget by September, reviving concerns over persistent project delays and weak fund absorption.
Odisha’s public finances are again under scrutiny after fresh data showed that, halfway through the financial year, the state had spent only a quarter of its capital outlay and just a third of its overall budget. According to figures presented by the finance department at a recent meeting of all secretaries, total expenditure stood at Rs 94,463 crore by the end of September, excluding debt servicing and disaster management, against a full-year budget of Rs 3.1 trillion for 2026-27. Of the Rs 1.8 trillion earmarked for programme spending, only Rs 58,508 crore had been used.
The shortfall was especially visible in capital spending, which is typically the part of the budget used for roads, buildings, irrigation works and other long-term assets. Odisha spent Rs 18,183 crore in the first six months of the year, or 25.2 per cent of the Rs 72,100 crore allocated for capital outlay in 2026-27. Establishment, operations and maintenance spending also slipped in absolute terms, underscoring how little room remains for a catch-up in the second half of the year. Officials warned that departments would need to move quickly on project execution, tendering, procurement, land acquisition and contractor payments to avoid the usual year-end rush and the risk of surrendering unspent funds.
The latest underperformance comes against a longer record of weak budget absorption. The Comptroller and Auditor-General of India said in its state finances report that Odisha left an average of 17 per cent of capital outlay and 20 per cent of overall budget provision unspent between 2020-21 and 2024-25. During that period, the state’s budget rose by 71.64 per cent, from Rs 1,67,663 crore to Rs 2,87,770 crore, yet savings against the approved outlay remained stubbornly high, ranging from 17.7 per cent to 25.98 per cent. The CAG also said Rs 2,36,868.57 crore remained unspent or was surrendered over five years, a figure that points to repeated execution problems rather than a one-off lapse.
Economists say the pattern raises uncomfortable questions about how budgets are framed and how quickly the administration can deliver projects. Amarendra Das, an associate professor at the National Institute of Science Education and Research in Bhubaneswar, told Business Standard that vacancies across departments and delays in central fund transfers were among the main reasons spending has lagged behind plans. He said Odisha would need a longer-term public expenditure strategy if it hopes to meet its target of becoming a $1.5 trillion economy by 2047, and argued that filling vacant posts would improve project execution and fund utilisation.
Chief Secretary Anu Garg has told departments to track spending more closely and step up both administrative and programme expenditure, with special attention to capital works. With the main working season now under way, engineering departments have been instructed to speed up implementation and aim for at least 10 per cent growth in expenditure over the next six months. An official who attended the meeting said secretaries were asked to identify delays in appraisal, detailed project reports, tender finalisation and Cabinet approvals, and to fix accountability where avoidable bottlenecks persist.
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