New Delhi, April 27 -- New Delhi: The total outstanding liabilities of states under a special central government low-cost loan scheme is estimated to have exceeded Rs.3.5 trillion by the end of FY25, two people familiar with the matter told Mint.

The Special Assistance to States for Capital Investment (SASCI) scheme is a 50-year, interest-free loan programme that the Centre uses to support capital expenditure by India's states.

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The development follows the Centre's push for higher state capital expenditure after economic growth slowed to 5.4% in the September quarter-the weakest pace in nearly two years-amid subdued government spending and declining consumption....