A recent Comptroller and Auditor General of India report exposes weakening fiscal discipline in Delhi, revealing declining growth, stagnant capital expenditure, and mounting liabilities amid concerns over long-term financial sustainability.
Delhi’s finances came under fresh scrutiny this week after the Comptroller and Auditor General of India tabled a report on the government’s 2024-25 accounts, with Chief Minister Rekha Gupta presenting it in the assembly on Monday, August 10. The audit, which was widely reported by Indian media, paints a picture of weakening fiscal discipline in the capital, arguing that growth lagged behind the rest of the country and that the administration failed to build enough long-term assets to support future expansion.
The report said Delhi’s per capita gross state domestic product rose at a compound annual rate of 6.39% between 2015 and 2025, below the 8.14% annual growth recorded for per capita GDP nationally over the same period. It also said the city’s contribution to national GDP has declined over the past decade, reinforcing concerns that Delhi has not kept pace with broader economic momentum.
A central theme of the audit was weak spending execution. According to the report, capital expenditure fell sharply, dropping from ₹8,311 crore in 2021-22 to ₹3,695 crore in 2024-25, while spending on road transport infrastructure declined from ₹1,448 crore to ₹390 crore in one year. The report also said the government spent only 6.53% of total expenditure on capital account in 2024-25, even as sizeable sums authorised by the assembly went unused.
The audit said Delhi spent ₹61,911.19 crore against a budget estimate of ₹80,798.81 crore, leaving ₹18,887.62 crore unspent. Of that, ₹11,263.34 crore was surrendered and ₹7,624.28 crore lapsed at the end of March 2025. It also said supplementary provisions and re-appropriations often proved unnecessary, with savings persisting even after money was shifted between heads.
At the same time, subsidy spending continued to rise. The CAG said subsidies made up 10.18% of revenue expenditure in 2024-25, with power subsidies accounting for the bulk of the outlay. It warned that this pattern could squeeze development spending and threaten fiscal sustainability, while calling for better budgeting, tighter expenditure control, improved transparency and broader structural reform.
The Delhi report also fits a wider warning from the CAG about state finances across India. A separate audit summary reported by Mint said combined liabilities of the country’s 28 states reached ₹90.51 trillion by March 31, 2025, while 18 states exceeded the Finance Commission’s fiscal deficit ceiling of 3% of GSDP. In Delhi’s case, The New Indian Express reported earlier that the fiscal deficit had widened to ₹3,934 crore in 2023-24 from ₹416 crore in 2019-20, underlining the extent of the pressure on the capital’s books.
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