New Delhi, Aug. 18 -- After a year of sharp increases, Indian states are expected to keep their off-budget borrowings largely flat in FY26, signalling a shift towards tighter fiscal discipline even amid persisting pressures for welfare spending, according to two people familiar with the matter. The restraint comes after years of heavy reliance on off-budget borrowings, which had ballooned during the pandemic with both the Centre and states scrambling to finance emergency spendings. Off-budget borrowings by states rose to Rs.29,335 crore in FY25 from Rs.21,251 crore the year before, finance ministry data shows. In FY21, at the height of covid-related spending, such borrowings had touched Rs.67,181 crore. "States have been told to enforce fis...