00:0016th Finance Commission.
00:03On 17th November 2025, the 16th Finance Commission submitted its report to the President.
00:11As mandated under Article 281 of the Constitution, the government is to lay the report along
00:18with the explanatory memorandum on the action taken report on the recommendations of the
00:24Commission in Parliament, which, Sir, Honourable Speaker, you will allow me to do at the commencement
00:30of the session.
00:31The government has accepted the recommendation of the Commission to retain the vertical share
00:37of devolution at 41%.
00:43As recommended by the Commission, I have provided 1.4 lakh crores of rupees to the States for
00:51the year 2026-2027 as Finance Commission grants.
00:58These include rural and urban local body and disaster management grants.
01:07Fiscal consolidation.
01:09Government has been delivering on our fiscal commitments consistently without compromising
01:15on social needs.
01:18To strive towards accepted standards of fiscal management in Budget 25-26, I had indicated
01:25that the central government would target reaching a debt-to-GDP ratio of 50 plus or minus 1% by
01:332030-31.
01:36In line with this, the debt-to-GDP ratio is estimated to be 55.6% of GDP in BE 26-27 compared to 56.1%
01:48of GDP in RE 25-26.
01:53A declining debt-to-GDP ratio will gradually free up resources for priority sector lending
02:01and expenditure by reducing the outgo on interest payments.
02:06One of the main operational instruments for debt targeting is the fiscal deficit.
02:12I am happy to inform this August House that I fulfilled my commitment made in 2021-2022
02:20to reduce fiscal deficit below 4.5% of GDP by 2025-26.
02:30In RE 25-26, the fiscal deficit has been estimated at par with BE of 2025-26 at 4.4% of GDP.
02:46In line with the new fiscal prudence path of debt consolidation, the fiscal deficit in BE 26-27
02:56is estimated to be 4.3% of the GDP.
03:09The revised estimates of the non-debt receipts are 34 lakh crores of which the Centre's net
03:18tax receipts are 26.7 lakh crores.
03:21The revised estimate of the total expenditure is 49.6 lakh crores of which the capital expenditure
03:29is about 11 lakh crores.
03:35Budget estimates 20-26 to 20-27.
03:40Coming to 26-27, the non-debt receipts and the total expenditure are estimated as 36.5 lakh
03:48crores and 53.5 lakh crores respectively.
03:51Thank you very much.
04:01Thank you very much.
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