Telangana Debt Nears ₹8 Lakh Crore by December 2025

The Telangana government’s ‘Socio Economic Outlook 2026’ report has highlighted the growing debt burden of the state. As of December 2025 , the total outstanding debt including borrowings of government entities and guarantees has reached ₹8,00,805 crore .

According to the report, from the time the Congress government assumed office in December 2023 until December 2025, the state and its affiliated institutions raised fresh loans worth ₹3,19,179 crore . During the same period, the government repaid ₹3,04,202 crore , including both principal and interest. This indicates that a significant portion of new borrowings was utilised for servicing past debt.

The report noted that the rise in liabilities must be viewed in the context of large borrowings by the previous government , along with high interest obligations and ongoing principal repayments. At the same time, expenditure on welfare schemes and development programmes has added to the financial pressure on the state.

Out of the total repayments of ₹3.04 lakh crore , about ₹1.90 lakh crore was towards principal and ₹1.14 lakh crore towards interest. The report described the state’s financial system as being in a “transition phase” , emphasising the need for medium-term strategies to ensure fiscal stability.

On the growth front, Telangana’s Gross State Domestic Product (GSDP) for 2025–26 , at current prices, is estimated at ₹17.82 lakh crore , registering a 10.7% growth rate , higher than the national average of 8%. Key sectors such as IT, trade, transport, and communication have driven this growth.

The per capita income in the state has reached ₹4.19 lakh , significantly higher than the national average of ₹2.20 lakh , with a growth rate of 10.2% . The report observed that the state’s economic position remains comparatively strong among Indian states.

Overall, the Outlook stated that Telangana’s economy is undergoing a phase of transformation , with the government focusing on balancing public expenditure priorities and achieving fiscal sustainability . It recommended framing medium-term fiscal strategies to reduce debt while sustaining growth in the coming years.