India, Feb. 25 -- The fiscal health of states remains a cornerstone for achieving sustained and inclusive economic growth and is central to realising the vision of Viksit Bharat by 2047. Among states' own tax revenues, excise duty emerges as the third-largest source, contributing nearly 17 per cent, after State GST and sales tax. This underscores the critical importance of efficient revenue mobilisation and optimisation at the state level. Persistent fiscal deficits compel states to rely on borrowings to finance expenditure. In FY25, states on average have budgeted borrowings amounting to 27.2 per cent of GSDP, reflecting continuing fiscal pressures.

In this context, assessing the gross fiscal deficit as a proportion of GSDP becomes part...