1. INTRODUCTION:

1.1 Introduction and Background: State Finances and Economic Development in India:

In India's federal structure, state finances assume a pivotal role, profoundly influencing economic growth, the provision of essential public services, and the overall trajectory of national development. States, increasingly vested with greater autonomy and responsibility in fiscal management, bear the primary burden of delivering public goods and services that directly impact the welfare of their citizens and foster local economic activity. Consequently, a comprehensive understanding of the fiscal health and financial trajectory of individual states is indispensable for assessing their capacity for sustainable development.

Chhattisgarh, a resource-rich state formed in 2000-01, presents a compelling case study for such an analysis. Its post-formation fiscal journey offers valuable insights into the interplay between state-level financial management and economic progress. This research aims to meticulously analyze the financial trajectory of Chhattisgarh over a significant period, identifying key patterns in its Gross State Domestic Product (GSDP), government expenditure, receipts, and deficits, and subsequently exploring their implications for the state's sustainable development. The study period, spanning 24 fiscal years from 2001-02 to 2024-25, is particularly robust, allowing for a comprehensive examination of long-term fiscal patterns and their evolution. This extensive timeframe enables the identification of the impact of major economic shifts, policy changes, and unforeseen events, offering a nuanced perspective on the state's fiscal resilience and vulnerabilities.

1.2 Research Questions:

This study seeks to address the following specific research questions:

· What are the significant trends in GSDP growth, government expenditure, and revenue/capital receipts in Chhattisgarh from 2001-02 to 2024-25?

· How has the fiscal deficit and revenue deficit evolved over this period, both in absolute terms and as a percentage of GSDP?

· What is the composition of government expenditure (revenue vs. capital) and how has it changed over time? What are the implications of these changes for economic development?

· How do Chhattisgarh's fiscal indicators (especially deficits) compare to commonly accepted fiscal prudence benchmarks (e.g., FRBM targets)?

· What are the potential implications of the observed fiscal trends (especially deficits) on the long-term economic sustainability and development prospects of Chhattisgarh?

1.3 Research Objectives:

To answer the aforementioned research questions, the study sets forth the following objectives:

· To identify and describe the historical trends and projections for GSDP, total expenditure, total receipts, revenue expenditure, and capital expenditure in Chhattisgarh.

· To calculate and analyze key fiscal ratios, including total expenditure as % of GSDP, revenue deficit as % of GSDP, and fiscal deficit as % of GSDP.

· To assess the state's fiscal performance against its own historical trends and, where applicable, against general norms for state finances in India.

· To evaluate the sustainability of the state's fiscal policy based on the trends of deficits and their financing.

· To draw conclusions regarding the interplay between fiscal management and economic growth in Chhattisgarh.

1.4 Hypotheses

The following hypotheses will be examined during the course of this research:

· H00: There is a positive correlation between sustained capital expenditure and GSDP growth in Chhattisgarh.

· H01: There is no positive correlation between sustained capital expenditure and GSDP growth in Chhattisgarh.

1.5 RESEARCH METHODOLOGY:

The research employs a quantitative, descriptive, and analytical approach, primarily utilizing time-series data to understand the fiscal dynamics of Chhattisgarh.

The primary data source for this study is a comprehensive table containing Chhattisgarh state's GSDP, expenditure, receipts, and deficit figures from the fiscal year 2001-02 to 2024-25. It is acknowledged that the data for the most recent years, specifically 2023-24 and 2024-25, are inferred figures, likely representing budget estimates or projections. The study covers a 24-year period, which is sufficiently long to allow for a comprehensive analysis of long-term trends and the inclusion of recent projections, offering a robust foundation for identifying evolving fiscal patterns.

The variables examined in this study include:

· Independent Variables: Total Expenditure, Revenue Expenditure, Capital Expenditure, Revenue Receipts, Capital Receipts, Revenue Deficit, Fiscal Deficit.

· Dependent Variable: GSDP (Gross State Domestic Product) / GSDP Growth Rate.

· Derived Variables: Total Expenditure/Outlay as % of GSDP, Total Receipts as % of GSDP, Revenue Deficit as % of GSDP, Fiscal Deficit as % of GSDP, Capital Expenditure as % of Total Expenditure.

· Various data analysis techniques will be applied:

· Trend Analysis: Line graphs will be utilized to plot each variable over time, facilitating the identification of patterns, shifts, and growth trajectories.

· Ratio Analysis: Key financial ratios, such as deficits as a percentage of GSDP and capital expenditure as a percentage of total expenditure, will be calculated and analyzed. This normalization of data enables meaningful comparisons across different years despite changes in absolute magnitudes.

· Growth Rate Analysis: Year-on-year growth rates for GSDP, expenditure, and receipts will be computed and compared to understand the pace of change in these fiscal indicators.

· Compositional Analysis: The changing shares of revenue versus capital components in total expenditure and receipts will be examined to discern shifts in the state's spending and revenue generation priorities.

· Comparative Analysis (Internal): Actual data will be compared against projected data for the latest years (2023-24, 2024-25) to assess the accuracy of budgetary estimates and identify potential deviations.

· Regression Analysis (Optional/Advanced): Should the research extend to establishing causal relationships, simple linear or multiple regression techniques could be employed to model the impact of fiscal variables (e.g., capital expenditure or fiscal deficit) on GSDP growth (e.g., GSDP_Growth_Rate = f(Capital_Exp_Ratio, Fiscal_Deficit_Ratio)).

· Threshold Analysis: An investigation into whether specific fiscal deficit or revenue deficit thresholds (as a percentage of GSDP) exist, beyond which the impact on GSDP growth changes (e.g., becomes negative), will be considered. This may necessitate more sophisticated econometric techniques if not visually evident from the data.

1.6 Expected Outcomes and Significance:

This research is expected to yield several valuable outcomes:

· Comprehensive Understanding: Provide a clear and detailed picture of Chhattisgarh's financial health and economic performance over more than two decades.

· Policy Insights: Offer data-driven insights for policymakers in Chhattisgarh, guiding future budget planning, resource allocation, and deficit management strategies.

· Fiscal Prudence Recommendations: Highlight specific areas where fiscal adjustments might be necessary to ensure the state's long-term financial sustainability.

· Academic Contribution: Contribute to the existing academic literature on state finances and sub-national economic development in India.

· Stakeholder Information: Inform citizens, businesses, and investors about the state's financial standing and economic prospects, fostering greater transparency and accountability.

1.7 Limitations:

· Data Granularity: The provided data is highly aggregated. A more granular analysis would benefit significantly from disaggregated data on specific tax revenues (e.g., State Goods and Services Tax, excise duties), non-tax revenues, and expenditure broken down by sector (e.g., education, health, infrastructure). Such detailed data could reveal more precise impacts and areas for intervention.

· External Factors: The analysis primarily relies on internal financial data. External economic shocks, major central government policies (beyond general transfers), or natural calamities, which are not explicitly detailed in the provided table, could significantly influence the state's finances and growth. Their specific impact cannot be fully quantified without additional, more contextualized data.

· Causality: While the study aims to identify correlations and relationships between fiscal variables and GSDP growth, establishing definitive causality often requires advanced econometric models and careful consideration of confounding factors that might influence both fiscal decisions and economic outcomes. This study primarily focuses on identifying strong associations and implications rather than proving direct causality.

2: Literature Review on Fiscal Dynamics and Economic Development:

Sharma P. (2024) conducted a mixed-methods assessment of Chhattisgarh’s three principal sectors—agriculture, industry, and services—using quantitative GDP shares and qualitative interviews. Her study underscored that mining continues to drive industrial growth but warns that infrastructure deficits and regulatory hurdles constrain diversification into textiles, food processing, and emerging IT and tourism sectors. Sharma A. (2024) analyzes 2010–11 to 2017–18 public expenditure patterns, revealing a Compound Annual Growth Rate (CAGR) of 16.5% in total state spending, with revenue outlays stabilizing around 16–19% of GSDP. He disaggregates plan versus non-plan expenditures and finds that rising social sector allocations (education, health, social security) have come at the cost of slower growth in economic services such as infrastructure and agriculture—potentially limiting future industrial competitiveness. Sharma M. 2024 further advocate strengthening MSME ecosystems, innovation hubs, and RandD incentives to foster technological adoption and enhance competitiveness in global markets. Behera S. and Dubey M. (2022) apply least squares regression to 2001–20 fiscal data, documenting a strong positive relationship (R²=0.989) between government expenditure and GSDP, and argue for high fiscal multipliers—especially in infrastructure and human capital investment—consistent with Keynesian theory. NITI Aayog’s macro-fiscal report (2025) situates Chhattisgarh’s 42.4% industry share of GSVA amid national trends, noting the state’s reliance on core mineral-based sectors and the need for balanced growth across emerging services and technology domains. Comparative work by the Accountability Initiative (PAISA) highlights Chhattisgarh’s social sector spending at 38% of total expenditure, contrasting with other states to assess the efficiency of fund utilization in education and health delivery, and underscoring the fiscal space for industrial infrastructure grants. Sectoral studies (INSPIRA, 2024) observe persistent skill mismatches, particularly in manufacturing and emerging high-tech industries, recommending robust vocational training aligned with industry needs to harness local labor. Simultaneously, environmental impact assessments for industrial clusters (Dagori EIA, CSIDC) stress the imperative of sustainable practices in steel, aluminium, cement, and power projects to mitigate ecological degradation and ensure community wellbeing.

2.3 The Fiscal Responsibility and Budget Management (FRBM) Framework:

The Fiscal Responsibility and Budget Management (FRBM) Act, 2003, represents a landmark legislative framework in India aimed at institutionalizing financial discipline, reducing fiscal deficits, and strengthening macroeconomic management. Its genesis lay in the recognition of the deteriorating state of government finances at both the Union and state levels.³ The primary objective of the Act was to eliminate the revenue deficit and bring down the fiscal deficit to a manageable 3% of GDP by March 2008.³ This was intended to ensure inter-generational equity in fiscal management and long-term macroeconomic stability.³

The Act mandated specific targets for the Central Government, initially aiming for a fiscal deficit of 3% of GDP by 2008, though this target was later revised and extended due to global financial crises and economic downturns.³ For instance, the target for the central government's fiscal deficit was revised to 5.8% in RE 2023-24, with a commitment to bring it below 4.5% by FY 2025-26.⁶ The FRBM framework also includes debt targets, aiming to limit general government debt to 60% of GDP and central government debt to 40% of GDP by March 2025.⁵ To promote transparency, the Act requires the government to present documents like the Medium-Term Fiscal Policy Statement, Fiscal Policy Strategy Statement, and Macroeconomic Framework Statement to Parliament annually.³

While the FRBM Act primarily applies to the Union Government, its principles have been adopted by states through their own Fiscal Responsibility Legislations (FRLs). These state-level FRLs have incentivized the formulation of fiscal policy strategies and Medium-Term Fiscal Plans (MTFPs), contributing to improved transparency in state finances. The general targets for states under this framework typically align with the central government's long-term goals, particularly a fiscal deficit target of 3% of GSDP and a state government debt target of 20% of GSDP.²

The FRBM Act incorporates an "escape clause," which allows the government to exceed fiscal deficit targets under extraordinary circumstances such as war, natural calamity, or severe economic downturns.³ While this provision offers necessary flexibility during crises, frequent or unjustified use of this clause can undermine the Act's credibility and commitment to long-term fiscal discipline.⁴ Critics also argue that strict fiscal targets might limit necessary investments in critical sectors like health, education, and infrastructure, potentially hurting long-term growth and social outcomes.⁴

A critical examination of Chhattisgarh's projected fiscal figures reveals a significant deviation from these established FRBM norms. The data indicates a Total Expenditure/Outlay as a percentage of GSDP of 29.02% for 2023-24 and 25.96% for 2024-25.¹ Furthermore, when calculating the fiscal deficit as a percentage of GSDP from the provided data, the projected fiscal deficit for 2023-24 is approximately 5.26% of GSDP (-26933.03 Cr / 512107 Cr *100) and for 2024-25 is approximately 4.93% of GSDP (-27975.07 Cr / 567880 Cr *100).¹ These figures are substantially higher than the 3% FRBM target for states.² Such a sustained deviation from fiscal prudence raises serious questions about the state's borrowing trajectory and its ability to manage debt without compromising future development. The large projected revenue deficits for these years (approximately 2.19% and 1.13% of GSDP respectively) further indicate that the state is borrowing to fund current consumption, which is a key indicator of fiscal stress and a violation of the "golden rule" of public finance.¹ This situation implies a severe breach of fiscal discipline and poses significant concerns for the state's long-term sustainability.

2.4 Gaps in Literature and Study's Contribution:

While extensive literature exists on India's state finances and the FRBM framework, a detailed, long-term analysis specifically focusing on Chhattisgarh's unique fiscal dynamics and their precise impact on its economic development from its formation to recent projections remains less explored. Many studies offer aggregated national or regional trends, but a deep dive into a single state, accounting for its specific economic structure (e.g., resource dependence) and policy shifts, can yield more granular and actionable insights. This study aims to fill this gap by providing a comprehensive, data-driven assessment of Chhattisgarh's fiscal trajectory, offering a nuanced understanding of its fiscal health and the interplay between its financial management and economic growth. The research will contribute to the existing body of knowledge by offering a detailed case study that can inform both state-specific policy formulation and broader discussions on sub-national fiscal management in India.

Table 1: Chhattisgarh state GSDP and Fiscal Data

Year	Total Expenditure / Outlay (Rs Crores)	Revenue Expenditure (Rs Crores)	Capital Expenditure (Rs Crores)	Loans and Advances (Rs Crores)	Revenue Expenditure as % of Total Expenditure	Capital Expenditure as % of Total Expenditure	Loans and Advances as % of Total Expenditure	Revenue Deficit (Rs crore)	Fiscal Deficit (Rs crore)
2001-02	5,471.48	4,914.36	476.26	80.87	89.82%	8.70%	1.48%	-536.66	-1086.7
2002-03	6,408.59	5,530.00	819.79	58.80	86.30%	12.79%	0.92%	-112.77	-97.6
2003-04	8,173.59	6,600.42	1,015.49	557.68	80.75%	12.42%	6.82%	-641.1	-2203.63
2004-05	8,495.22	7,103.05	1,279.13	113.04	83.61%	15.06%	1.33%	145.82	-1231.55
2005-06	9,291.53	7,457.14	1,496.91	337.48	80.26%	16.11%	3.63%	1481.35	-435.12
2006-07	11,773.40	8,802.44	2,198.10	772.86	74.77%	18.67%	6.56%	2650.8	-36.77
2007-08	14,383.12	10,750.08	3,130.69	502.36	74.74%	21.77%	3.49%	3128.57	-38.16
2008-09	17,226.08	13,793.71	2,940.16	492.21	80.07%	17.07%	2.86%	1869.06	1026.68
2009-10	20,910.44	17,265.44	2,744.92	900.08	82.57%	13.13%	4.31%	888.7	-1757.67
2010-11	22,876.16	19,355.75	2,951.51	568.89	84.61%	12.90%	2.49%	3236.79	409.76
2011-12	27,957.22	22,628.05	4,056.41	1,272.77	80.94%	14.51%	4.55%	3239.39	-801.16
2012-13	33,778.67	26,971.84	4,919.33	1,887.50	79.84%	14.56%	5.59%	2606.25	-2654.66
2013-14	38,757.28	32,859.58	4,574.19	1,323.51	84.78%	11.80%	3.41%	-809.31	-5057.81
2014-15	46,204.07	39,497.20	6,617.32	89.55	85.48%	14.32%	0.19%	-1564.4	-8072.22
2015-16	51,811.29	43,701.06	7,945.01	165.22	84.35%	15.33%	0.32%	2366.65	-8015.81
2016-17	57,916.70	48,164.60	9,470.51	281.59	83.16%	16.35%	0.49%	5520.63	-5055.51
2017-18	66,600.54	56,229.75	10,000.96	369.83	84.43%	15.02%	0.56%	3417.3	6837.03
2018-19	73,569.86	64,421.50	8,903.45	244.91	87.56%	12.10%	0.33%	677.08	-8298.88
2019-20	82,094.93	73,472.39	8,566.39	56.16	89.49%	10.43%	0.07%	-9683.67	-15862.4
2020-21	79,107.54	70,032.84	9,024.19	50.51	88.53%	11.41%	0.06%	-6856.6	-15824.6
2021–22	102,483.00	75,010.00	10,828.00	None	73.19%	10.57%	0.00%	4642.02	-6091.21
2022–23	104,000.00	85,285.00	13,406.20	None	81.99%	12.89%	0.00%	8592.11	-4691.31
2023–24	148,612.00	114,741.00	15,730.90	311.50	77.21%	10.59%	0.21%	-11232.8	-26935
2024–25	147,440.00	126,767.00	21,255.30	321.66	85.98%	14.42%	0.22%	-6424.71	-27975

Sources: Directorate of Economics and Statistics, Chhattisgarh and Finance Department of Chhattisgarh

3: Descriptive Interpretation of Chhattisgarh's Financial Data:

This chapter provides a narrative overview of Chhattisgarh's raw financial data from 2001-02 to 2024-25, highlighting initial trends and patterns without delving into in-depth analytical interpretation. The aim is to establish a foundational understanding of the state's fiscal landscape over the study period.

3.1 Overview of GSDP Trends (2001-02 to 2024-25)

Chhattisgarh's Gross State Domestic Product (GSDP) has experienced substantial growth over the two-decade study period, expanding from Rs 25,846.16 Crores in 2001-02 to a projected Rs 567,880 Crores in 2024-25.¹ This represents a significant economic expansion, underscoring the state's overall developmental progress since its formation.

The growth trajectory, however, has not been uniformly stable, exhibiting periods of both acceleration and deceleration. Notable periods of strong GSDP growth include 2004-05 (19.42%), 2007-08 (25.28%), 2012-13 (32.37%), and 2022-23 (19.46%).¹ Conversely, the state experienced sharp decelerations in GSDP growth in 2010-11 (2.47%) and 2016-17 (1.83%).¹ A particularly significant observation is the negative growth rate (Growth Rate 2) of -3.64% in 2020-21 ¹, which strongly reflects the widespread economic impact of the COVID-19 pandemic and associated lockdowns. While GSDP has grown substantially in absolute terms, the presence of periods with very low or negative growth rates indicates that Chhattisgarh's economic development has not been uniformly stable, pointing to underlying vulnerabilities or susceptibility to external shocks. This volatility suggests that the state's economy might be susceptible to factors such as commodity price cycles (given its resource-rich nature), agricultural dependence, or broader national/global economic downturns.

3.2 Analysis of Total Expenditure/Outlay:

Total government spending in Chhattisgarh has witnessed a substantial absolute increase over the study period, rising from Rs 5,471.48 Crores in 2001-02 to a projected Rs 147,440 Crores in 2024-25.¹ This upward trend indicates a growing scale of government operations and an expanding role of the state in the economy.

When viewed as a percentage of GSDP, Total Expenditure/Outlay has shown fluctuations. It began at 21.17% in 2001-02, dipped to a low of 19.41% in 2005-06, but generally trended upwards in later years. A notable peak is observed in 2023-24 at 29.02% of GSDP, followed by a projected dip to 25.96% in 2024-25.¹ The general upward trend in total expenditure, both in absolute terms and as a percentage of GSDP, particularly in recent years, suggests an increasing involvement of the state government in the economy. This could be indicative of an expanding scope of public services, infrastructure development initiatives, or welfare programs. However, a rising share of government expenditure in GSDP also raises questions about the efficiency and productivity of this spending, especially when considered in conjunction with deficit trends.

3.3 Trends in Revenue and Capital Receipts:

Revenue Receipts have consistently served as the dominant source of the state's income, demonstrating a steady growth from Rs 4,375.69 Crores in 2001-02 to a projected Rs 120,342 Crores in 2024-25.¹ This reflects the state's reliance on its own-source revenues (tax and non-tax revenues) and transfers from the central government to finance its operations.

In contrast, Capital Receipts have exhibited significant volatility and fluctuating contributions to the state's overall income. While they were Rs 1,207.12 Crores in 2001-02, they even dipped to a negative value (-39.84 Crores) in 2005-06.¹ However, there have been notable spikes in capital receipts in certain years, such as Rs 2,469.93 Crores in 2003-04, Rs 8,426.88 Crores in 2013-14, Rs 16,710.53 Crores in 2019-20, and significant projected figures of Rs 26,963.7 Crores in 2023-24 and Rs 28,001.8 Crores in 2024-25.¹ The state's financial stability heavily relies on its revenue receipts, which are generally more predictable. The erratic nature and occasional large inflows of capital receipts, which often include borrowings or disinvestment proceeds, suggest that these inflows might be reactive to specific needs or opportunities rather than part of a consistent long-term capital funding strategy. This unpredictability could pose challenges for sustained long-term investment planning.

3.4 Examination of Revenue and Capital Expenditure:

A descriptive comparison of expenditure patterns reveals that Revenue Expenditure consistently dominates Capital Expenditure throughout the study period. Revenue Expenditure grew from Rs 4,914.36 Crores in 2001-02 to a projected Rs 126,767 Crores in 2024-25.¹ In contrast, Capital Expenditure, while also growing from Rs 476.26 Crores in 2001-02 to a projected Rs 21,255.3 Crores in 2024-25, remains a significantly smaller proportion of total spending.¹

This disproportionately higher revenue expenditure suggests that a substantial portion of the state's budget is allocated to recurring expenses such as day-to-day administrative costs, salaries, pensions, and subsidies. This indicates that the state's spending priorities might be skewed towards immediate consumption rather than the creation of long-term productive assets. Such a pattern raises immediate questions about the "quality of expenditure" and its potential impact on GSDP growth, as capital expenditure is generally considered more conducive to long-term economic development.

3.5 Evolution of Deficits (Revenue and Fiscal):

The trends in Chhattisgarh's Revenue Deficit/Surplus have been fluctuating. The state experienced periods of revenue surplus, notably from 2004-05 to 2012-13 (with a brief deficit in 2008-09), again from 2015-16 to 2018-19, and in 2021-22 and 2022-23.¹ However, there have also been significant revenue deficits, such as in 2001-02, 2013-14, 2014-15, 2019-20, and 2020-21. Critically, the most recent projections show large revenue deficits for 2023-24 (-11,232.76 Crores) and 2024-25 (-6,424.77 Crores).¹

Fiscal Deficits have been a consistent feature of Chhattisgarh's finances throughout the study period, indicated by negative values in the data.¹ These deficits have grown from -1,086.7 Crores in 2001-02 to a projected -27,975.07 Crores in 2024-25.¹ The persistent presence of fiscal deficits implies a continuous reliance on borrowing to finance the state's overall expenditure, which inherently adds to public debt and future debt servicing obligations. The significant projected revenue and fiscal deficits in the most recent years (2023-24, 2024-25) suggest a potential deterioration of fiscal health, signaling a departure from previous periods of relative prudence. This shift from revenue surplus to large revenue deficits in recent projections is a critical observation. A revenue deficit implies that the state is borrowing to meet its day-to-day expenses, a practice generally considered unsustainable and a violation of the "golden rule" of public finance. Coupled with the already persistent fiscal deficits, this indicates growing fiscal stress and raises immediate concerns about the state's ability to finance its development agenda without accumulating unsustainable debt.

3.6 Observations and Patterns:

From this descriptive interpretation, several striking trends and patterns emerge. There has been an impressive overall growth in Chhattisgarh's GSDP and total government expenditure over the two decades. However, this growth has been accompanied by significant volatility in GSDP and a consistent dominance of revenue expenditure over capital expenditure. The state's revenue model primarily relies on revenue receipts, while capital receipts exhibit considerable unpredictability. Most notably, the recent projected figures indicate a sharp increase in both revenue and fiscal deficits, signaling a potential period of heightened fiscal stress. These observations set the stage for a deeper, more analytical examination of the underlying causes and implications in the subsequent sections.

4: DATA ANALYSIS AND RESULTS:

4.1 GSDP Growth Performance:

Chhattisgarh's GSDP has demonstrated a robust long-term growth trajectory, yet with notable fluctuations in its annual growth rates. A detailed examination of the year-on-year growth reveals periods of significant acceleration and deceleration. For instance, the state experienced impressive growth rates such as 25.28% in 2007-08 and a remarkable 32.37% in 2012-13, indicating strong economic momentum during these periods.¹ More recently, 2022-23 saw a substantial growth of 19.46%.¹

However, the GSDP growth has also been subject to periods of significant slowdown. Growth rates plummeted to 2.47% in 2010-11 and 1.83% in 2016-17.¹ The most pronounced deceleration occurred in 2020-21, with a negative growth rate (Growth Rate 2) of -3.64%.¹ This sharp contraction is directly attributable to the severe economic disruptions caused by the global COVID-19 pandemic and the subsequent lockdowns, which significantly impacted economic activity across various sectors. The GSDP data reveals that while Chhattisgarh has achieved substantial economic expansion over the long term, it has experienced significant fluctuations, indicating periods of both resilience and vulnerability to economic shocks. The negative growth in 2020-21 highlights its susceptibility to widespread crises like the pandemic, demonstrating how external, unforeseen events can profoundly affect the state's economic performance. Conversely, its ability to rebound in subsequent years suggests a degree of underlying economic resilience.

4.2 Expenditure Analysis:

The analysis of Chhattisgarh's expenditure patterns reveals critical insights into the state's fiscal priorities and their potential implications for economic development.

Total Expenditure/Outlay as % of GSDP:

The state's Total Expenditure/Outlay as a percentage of GSDP has varied over the study period. Starting at 21.17% in 2001-02, it generally remained in the low 20s for much of the first decade. However, a significant increase is observed in the later years, culminating in a peak of 29.02% in 2023-24, before a projected slight decrease to 25.96% in 2024-25.1 This upward trend suggests a growing role of government spending relative to the size of the state's economy, potentially reflecting expanding public services, welfare programs, or increased investment needs.

Detailed Analysis of Revenue Expenditure vs. Capital Expenditure:

A closer examination of the composition of expenditure highlights a consistent dominance of Revenue Expenditure over Capital Expenditure. Revenue Expenditure has grown from Rs 4,914.36 Crores in 2001-02 to a projected Rs 126,767 Crores in 2024-25, representing the bulk of the state's spending.1 Capital Expenditure, while also increasing in absolute terms from Rs 476.26 Crores to Rs 21,255.3 Crores over the same period, remains a smaller component.¹

To better understand the quality of expenditure, it is crucial to analyze Capital Expenditure as a percentage of Total Expenditure. In 2001-02, Capital Expenditure constituted approximately 8.7% of Total Expenditure (Rs 476.26 Cr / Rs 5471.48 Cr). This percentage fluctuated, reaching a high of around 22.8% in 2007-08 (Rs 3130.69 Cr / Rs 14383.12 Cr) but then generally declined or remained stagnant for several years, hovering around 10-15%. For 2024-25, it is projected to be approximately 14.4% (Rs 21255.3 Cr / Rs 147440 Cr).¹

The analysis of Capital Expenditure as a percentage of Total Expenditure is crucial for understanding the state's growth potential. If this ratio remains low or fluctuates significantly, it indicates a potential underinvestment in growth-enhancing infrastructure and assets, hindering long-term GSDP growth, even if total expenditure is rising. The "golden rule" of public finance suggests that capital expenditure should ideally be financed through borrowing, while revenue expenditure should be met from revenue receipts.² When a smaller proportion of the budget is consistently allocated to capital expenditure, it implies that a larger share is directed towards consumption-oriented spending (revenue expenditure). This can limit future growth potential and make the economy less competitive, potentially hindering the state's ability to achieve sustained GSDP growth, thus providing important context for Hypothesis H1 (positive correlation between capital expenditure and GSDP growth).

Table 2: Composition of Chhattisgarh's Expenditure (2001-02 to 2024-25)

Year	Total Expenditure /Outlay (Rs Crores)	Revenue Expenditure (Rs Crores)	Capital Expenditure (Rs Crores)	Loans and Advances (Rs Crores)	Revenue Expenditure as % of Total Expenditure	Capital Expenditure as % of Total Expenditure	Loans and Advances as % of Total Expenditure
2001-02	5,471.48	4,914.36	476.26	80.87	89.82%	8.70%	1.48%
2002-03	6,408.59	5,530.00	819.79	58.80	86.30%	12.79%	0.92%
2003-04	8,173.59	6,600.42	1,015.49	557.68	80.75%	12.42%	6.82%
2004-05	8,495.22	7,103.05	1,279.13	113.04	83.61%	15.06%	1.33%
2005-06	9,291.53	7,457.14	1,496.91	337.48	80.26%	16.11%	3.63%
2006-07	11,773.40	8,802.44	2,198.10	772.86	74.77%	18.67%	6.56%
2007-08	14,383.12	10,750.08	3,130.69	502.36	74.74%	21.77%	3.49%
2008-09	17,226.08	13,793.71	2,940.16	492.21	80.07%	17.07%	2.86%
2009-10	20,910.44	17,265.44	2,744.92	900.08	82.57%	13.13%	4.31%
2010-11	22,876.16	19,355.75	2,951.51	568.89	84.61%	12.90%	2.49%
2011-12	27,957.22	22,628.05	4,056.41	1,272.77	80.94%	14.51%	4.55%
2012-13	33,778.67	26,971.84	4,919.33	1,887.50	79.84%	14.56%	5.59%
2013-14	38,757.28	32,859.58	4,574.19	1,323.51	84.78%	11.80%	3.41%
2014-15	46,204.07	39,497.20	6,617.32	89.55	85.48%	14.32%	0.19%
2015-16	51,811.29	43,701.06	7,945.01	165.22	84.35%	15.33%	0.32%
2016-17	57,916.70	48,164.60	9,470.51	281.59	83.16%	16.35%	0.49%
2017-18	66,600.54	56,229.75	10,000.96	369.83	84.43%	15.02%	0.56%
2018-19	73,569.86	64,421.50	8,903.45	244.91	87.56%	12.10%	0.33%
2019-20	82,094.93	73,472.39	8,566.39	56.16	89.49%	10.43%	0.07%
2020-21	79,107.54	70,032.84	9,024.19	50.51	88.53%	11.41%	0.06%
2021–22	102,483.00	75,010.00	10,828.00	None	73.19%	10.57%	0.00%
2022–23	104,000.00	85,285.00	13,406.20	None	81.99%	12.89%	0.00%
2023–24	148,612.00	114,741.00	15,730.90	311.50	77.21%	10.59%	0.21%
2024–25	147,440.00	126,767.00	21,255.30	321.66	85.98%	14.42%	0.22%

Sources: Directorate of Economics and Statistics, Chhattisgarh and Finance Department of Chhattisgarh

4.3 Receipts Analysis:

The analysis of Chhattisgarh's receipts highlights the composition of its funding sources and their stability over time. Revenue Receipts have consistently formed the bedrock of the state's financial inflows, growing steadily throughout the period.¹ This indicates a strong reliance on its own-source tax and non-tax revenues, along with central transfers, to meet its recurring expenditure needs.

Capital Receipts, on the other hand, have shown greater volatility and an inconsistent contribution to total receipts. While there have been periods of substantial capital inflows, such as in 2013-14, 2014-15, 2019-20, and the projected years 2023-24 and 2024-25 ¹, these spikes are often interspersed with periods of lower or even negative capital receipts. The percentage contribution of Capital Receipts to Total Receipts has varied significantly, reflecting their less predictable nature compared to revenue receipts. The increasing reliance on capital receipts in recent projected years, which are often derived from borrowings, raises concerns about the sustainability of the state's revenue model if own-source revenue generation is not keeping pace. If a significant portion of total receipts is increasingly coming from capital receipts (which often include borrowings), it implies that the state is relying more on debt to finance its activities, rather than robust growth in its own-source revenue. This dependence on borrowing for overall receipts can lead to an unsustainable debt burden in the long run, especially if these funds are not channeled into productive capital assets. This aspect is crucial for evaluating the overall fiscal health and for formulating effective revenue augmentation strategies.

4.4 Deficit Analysis:

The evolution of Chhattisgarh's revenue and fiscal deficits is a critical indicator of its fiscal health and adherence to prudence benchmarks.

Revenue Deficit/Surplus as % of GSDP:

Chhattisgarh has experienced periods of both revenue surplus and deficit. From 2004-05 to 2012-13, the state generally maintained a revenue surplus, indicating that its revenue receipts were sufficient to cover its revenue expenditures.1 Surpluses were also observed from 2015-16 to 2018-19, and in 2021-22 and 2022-23.1 However, significant revenue deficits emerged in 2001-02, 2013-14, 2014-15, 2019-20, and 2020-21. The most concerning trend is the projected return to substantial revenue deficits in the latest years: -2.19% of GSDP in 2023-24 and -1.13% of GSDP in 2024-25.1 These figures are significantly higher than the general norm for states, which maintained a revenue deficit of 0.2% of GDP during 2021-22 to 2023-24.2 A persistent revenue deficit implies that the state is borrowing to finance its day-to-day consumption, which is fiscally unsustainable and runs contrary to the "golden rule" of public finance.

Fiscal Deficit as % of GSDP:

Fiscal deficits have been a consistent feature of Chhattisgarh's finances throughout the study period, signifying a continuous reliance on borrowing to meet its overall expenditure requirements. In 2001-02, the fiscal deficit was approximately -4.20% of GSDP (-1086.7 Cr / 25846.16 Cr).1 While the deficit reduced in some years, even turning into a small surplus in 2010-11 (0.41% of GSDP), it has generally remained in deficit territory. The projected fiscal deficits for the most recent years are particularly noteworthy: approximately -5.26% of GSDP in 2023-24 and -4.93% of GSDP in 2024-25.¹

Comparison with FRBM Targets:

These projected fiscal deficit percentages (5.26% and 4.93%) for 2023-24 and 2024-25 are substantially above the 3% of GSDP target recommended under the FRBM framework for states.2 Similarly, the projected revenue deficits of 2.19% and 1.13% for these years are significantly higher than the 0.2% average revenue deficit maintained by states during 2021-22 to 2023-24.2 This sustained deviation from fiscal prudence raises concerns about the state's borrowing trajectory and its ability to manage debt without compromising future development. The large revenue deficits in these projected years mean the state is borrowing to fund current consumption, which is a key indicator of fiscal stress. This directly supports Hypothesis H2 (increasing revenue deficits indicating reliance on borrowing for consumption, hindering capital formation) and H3 (fiscal deficit exceeding thresholds negatively impacts growth). The combined picture of high total expenditure as a percentage of GSDP, persistent revenue deficits, and fiscal deficits exceeding FRBM targets, especially in the projected years, indicates a significant risk of fiscal slippage and potential long-term debt accumulation.

Table 3: Chhattisgarh's Deficits as % of GSDP and Comparison with FRBM Targets (2001-02 to 2024-25)

Year	GSDP (Rs Crores)	Revenue Deficit (Rs Crores)	Revenue Deficit as % of GSDP	Fiscal Deficit (Rs Crores)	Fiscal Deficit as % of GSDP	FRBM Fiscal Deficit Target (for states)
2001-02	25,846.16	-538.66	-2.08%	-1,086.70	-4.20%	-
2002-03	29,539.35	-112.70	-0.38%	-972.60	-3.29%	-
2003-04	32,492.65	-641.10	-1.97%	-2,203.63	-6.78%	-
2004-05	38,802.09	145.82	0.38%	-1,231.55	-3.17%	3.00%
2005-06	47,862.29	1,381.35	2.88%	-435.12	-0.91%	3.00%
2006-07	53,381.10	2,650.80	4.97%	36.77	0.07%	3.00%
2007-08	66,874.89	3,128.57	4.68%	-38.16	-0.06%	3.00%
2008-09	80,255.11	1,869.06	2.33%	-1,026.66	-1.28%	3.00%
2009-10	96,972.18	888.70	0.92%	-1,757.67	-1.81%	3.00%
2010-11	99,364.26	3,363.79	3.39%	409.76	0.41%	3.00%
2011-12	119,419.76	3,239.34	2.71%	-801.16	-0.67%	3.00%
2012-13	158,073.82	2,606.25	1.65%	-2,654.66	-1.68%	3.00%
2013-14	177,511.32	-809.31	-0.46%	-5,057.81	-2.85%	3.00%
2014-15	206,833.18	-1,564.40	-0.76%	-8,072.20	-3.90%	3.00%
2015-16	221,118.11	2,366.65	1.07%	-5,615.81	-2.54%	3.00%
2016-17	225,162.99	5,520.65	2.45%	-4,055.72	-1.80%	3.00%
2017-18	262,801.75	3,417.33	1.30%	-6,837.03	-2.60%	3.00%
2018-19	282,283.44	677.05	0.24%	-8,298.88	-2.94%	3.00%
2019-20	318,101.13	-9,603.69	-3.02%	-18,064.63	-5.68%	3.00%
2020-21	344,955.35	-6,856.67	-1.99%	-15,822.38	-4.59%	3.00%
2021–22	383,098.00	4,642.02	1.21%	-6,093.10	-1.59%	3.00%
2022–23	457,608.00	8,592.11	1.88%	-4,691.21	-1.02%	3.00%
2023–24	512,107.00	-11,232.76	-2.19%	-26,933.03	-5.26%	3.00%
2024–25	567,880.00	-6,424.77	-1.13%	-27,975.07	-4.93%	3.00%

Sources: Directorate of Economics and Statistics, Chhattisgarh and Finance Department of Chhattisgarh

4.5 Correlation and Relationships:

While a full econometric regression analysis is beyond the scope of this descriptive and analytical chapter, the observed trends allow for preliminary discussions regarding the relationships among key fiscal variables and GSDP growth, providing initial insights into the hypotheses.

Pearson Correlation Calculation:

To assess Hypothesis H1, which posits a positive correlation between sustained capital expenditure and GSDP growth in Chhattisgarh, we calculate the Pearson correlation coefficient between these two variables using the provided financial data for the period 2001-02 to 2024-25.

The variables used for this calculation are:

· Capital Expenditure (Rs Crores)

· GSDP Growth Rate (Growth Rate 2 in %)

The Pearson correlation coefficient between annual GSDP and government expenditure was computed as:

Where:

· n = number of data pairs (24 years in this study)

· x = Capital Expenditure for each year

· y = GSDP Growth Rate (Growth Rate 2) for each year

· ∑ denotes the sum of the respective values across all years.

RESULT:

Upon performing the calculation with these data points, the Pearson correlation coefficient is approximately 0.30. Regarding Hypothesis H1, which poses a weak to moderate positive correlation between sustained capital expenditure and GSDP growth, the data shows that periods of higher capital expenditure (e.g., 2007-08, 2011-12, 2015-16, 2016-17) are often followed or accompanied by periods of robust GSDP growth.¹ For example, the significant capital outlay in 2007-08 (Rs 3,130.69 Cr) preceded strong GSDP growth in 2007-08 (25.28%) and 2008-09 (20.01%).¹ Similarly, increased capital expenditure in 2011-12 (Rs 4,056.41 Cr) was followed by a substantial GSDP growth of 32.37% in 2012-13.¹ This suggests an empirical alignment with the theoretical expectation that productive spending contributes to economic expansion.

5: Critical Reasoning and Policy Implications:

5.1 Interpretation of Findings:

Chhattisgarh's fiscal narrative presents a complex picture of growth alongside emerging fiscal challenges. The state has achieved substantial GSDP expansion over two decades, yet this growth has been punctuated by periods of significant volatility, highlighting its susceptibility to economic shocks, as evidenced by the negative GSDP growth during the COVID-19 pandemic.

The analysis of expenditure composition reveals a consistent prioritization of revenue expenditure over capital expenditure, with the latter often constituting a relatively small proportion of total spending.¹ This pattern suggests that a large share of the state's budget is consumed by recurring costs such as salaries, pensions, and subsidies, rather than long-term asset creation. The fluctuations in capital expenditure could be attributed to various factors, including project cycles, availability of central grants, or shifts in political priorities. The recent projected return to significant revenue deficits for 2023-24 and 2024-25, after periods of surplus, indicates a potential structural imbalance where recurring revenues are insufficient to cover recurring expenses.¹ This imbalance could stem from an expanding public sector wage bill, increasing social welfare schemes, or a stagnant own-source tax base. Moreover, factors such as the cessation of GST compensation and tapering of Finance Commission grants from the Centre, as well as persistent losses in the power sector (DISCOMs), are known to exert significant pressure on state finances across India, likely contributing to Chhattisgarh's fiscal strain.

Evaluating the effectiveness of past fiscal policies, it appears that while the state has successfully fostered overall economic growth, its fiscal management has not consistently maintained prudence, particularly in recent projected years. The tendency to incur revenue deficits suggests that borrowed funds are being used for consumption rather than investment, potentially undermining the long-term sustainability of development initiatives.

5.2 Fiscal Health Assessment:

A detailed assessment of Chhattisgarh's fiscal health reveals areas of concern, particularly in the projected near future.

· Deficit Levels: The projected fiscal deficits of approximately 5.26% of GSDP for 2023-24 and 4.93% for 2024-25 are significantly higher than the 3% FRBM target for states.¹ Similarly, the projected revenue deficits of 2.19% and 1.13% of GSDP for these years are considerably above the 0.2% average revenue deficit maintained by states in recent times.¹ This sustained deviation from fiscal prudence indicates a significant fiscal imbalance.

· Debt Sustainability Implications: While specific debt-to-GSDP ratios are not provided, persistent high fiscal deficits inevitably lead to increased public debt. The FRBM framework recommends limiting state government debt to 20% of GSDP. If Chhattisgarh's current borrowing trajectory continues, it risks exceeding prudent debt levels, which could lead to higher debt servicing costs, reduced fiscal flexibility, and potential downgrades in credit ratings.

· Quality of Expenditure: The consistent dominance of revenue expenditure over capital expenditure, as observed in Chapter 4.2, suggests that a significant portion of the state's spending is consumption-oriented. This limits the creation of long-term productive assets that are crucial for sustained economic growth and future revenue generation.

Benchmarking Chhattisgarh's performance against other comparable Indian states or the average state performance (e.g., average GFD of 2.7% of GDP for states during 2004-05 to 2023-24, and revenue deficit of 0.2% of GDP during 2021-22 to 2023-24) underscores the severity of the projected fiscal slippage. The combined picture of high total expenditure as a percentage of GSDP, persistent revenue deficits, and fiscal deficits exceeding FRBM targets, especially in the projected years, indicates a significant risk of fiscal slippage and potential long-term debt accumulation. This implies that the state's current fiscal path is unsustainable and could lead to a debt trap, reduced creditworthiness, and limited fiscal space for future development initiatives.

5.3 Impact on Economic Development:

The fiscal choices made by Chhattisgarh's government have direct implications for its long-term economic development. High revenue expenditure, particularly when financed by borrowing (as indicated by revenue deficits), represents a diversion of resources from growth-enhancing investments. Funds spent on salaries, pensions, and subsidies, while fulfilling social objectives, do not directly create productive assets or enhance the economy's supply side capacity. This can lead to a trade-off between short-term consumption-oriented spending and long-term investment for sustainable economic development.

Increasing fiscal deficits, especially when they exceed prudent thresholds, can have several adverse effects. They necessitate higher borrowing, which can lead to "crowding out" effects where government borrowing absorbs a larger share of available financial resources, leaving less for private sector investment. This can stifle private capital formation, innovation, and job creation, ultimately impeding GSDP growth. Furthermore, rising debt servicing costs due to increased borrowing can consume a larger portion of future budgets, reducing the fiscal space available for critical development spending in sectors like education, health, and infrastructure. This also raises concerns about inter-generational equity, as the burden of current fiscal imprudence is effectively passed on to future generations who will bear the cost of debt repayment.

5.4 Policy Recommendations:

To address the identified fiscal challenges and ensure long-term economic sustainability, a holistic approach to fiscal reform is necessary, encompassing both revenue and expenditure sides, and integrating principles of transparency and accountability.

5.4.1 Revenue Augmentation:

Strategies to enhance Chhattisgarh's own-source revenue are crucial. This includes exploring further tax reforms, improving tax compliance through modernization of tax administration (e.g., e-registration, e-filing, e-payment, as seen with GST adoption) ², and diversifying non-tax revenue sources. Reducing reliance on central transfers, while challenging, can enhance fiscal autonomy.

5.4.2 Expenditure Rationalization:

Measures to control unproductive revenue expenditure are essential. This involves rationalizing subsidies to ensure they are targeted and efficient, and managing administrative costs effectively. Reallocation of funds towards growth-enhancing capital expenditure is paramount, adhering to the "golden rule" of public finance, which suggests financing current expenditures from current revenues and capital expenditures through borrowing.² Implementing "outcome budgeting," linking spending to measurable outcomes, can foster greater accountability and ensure targeted resource use, improving the quality of expenditure.²

5.4.3 Debt Management:

Prudent borrowing and debt servicing strategies are vital to ensure fiscal sustainability. While greater reliance on market-based financing has been observed across states ², Chhattisgarh must ensure that such borrowing remains within sustainable limits and is primarily directed towards productive investments. A clear debt management policy is required to prevent accumulation of unsustainable debt.

5.4.4 Fiscal Transparency and Accountability:

Improving financial reporting and public oversight is critical. This involves strengthening the implementation of state-level Fiscal Responsibility Legislations (FRLs) and developing robust Medium-Term Fiscal Plans (MTFPs) to provide a clear roadmap for fiscal policy strategies.² Enhanced transparency builds public trust and allows for better informed public discourse on fiscal matters.

5.4.5 Sectoral Focus:

Targeted investments based on Chhattisgarh's economic structure and development needs are important. Leveraging the state's natural resources strategically and promoting specific industries can boost GSDP. A significant area requiring attention is the power sector, where large accumulated losses have been a drag on state finances.² Initiatives aimed at enhancing productivity, reducing transmission and distribution losses, and rationalizing tariffs are necessary to contain these losses and free up fiscal space for other development priorities.²

5.5 Challenges and Opportunities:

Chhattisgarh faces several challenges in its fiscal journey. A persistent challenge is the dependency on central transfers, which, despite being a significant source of revenue, can create vulnerabilities when these transfers decline, as seen with the cessation of GST compensation and tapering of Finance Commission grants.² The state is also susceptible to external economic shocks, which can impact its GSDP and revenue collection. Furthermore, implementation bottlenecks in large-scale projects can hinder the effective utilization of capital expenditure.

However, opportunities abound. Chhattisgarh can strategically leverage its rich natural resources to drive industrial growth and enhance revenue generation. Promoting specific industries where the state has a comparative advantage can diversify its economic base and reduce reliance on a few sectors. Adopting "next generation" fiscal rules, which allow for some counter-cyclical fiscal policy space during large exogenous shocks and incorporate a risk-based fiscal framework considering state-level fundamentals, could provide greater flexibility and resilience.² Embracing best practices in fiscal management, including modern tax administration and outcome-based budgeting, can significantly improve efficiency and effectiveness of public spending.

6: CONCLUSION AND SUGGESTIONS:

6.1 Summary of Key Findings:

This study has provided a comprehensive analysis of Chhattisgarh's fiscal dynamics and their impact on economic development from 2001-02 to 2024-25. The state has experienced significant GSDP growth over two decades, albeit with notable volatility, highlighting its susceptibility to economic shocks. Government expenditure has also grown substantially, both in absolute terms and as a percentage of GSDP, indicating an expanding role of the state in the economy.

A critical finding is the consistent dominance of revenue expenditure over capital expenditure, suggesting a prioritization of consumption-oriented spending over long-term asset creation. While revenue receipts remain the primary source of income, capital receipts exhibit high volatility. Most importantly, the analysis reveals a concerning trend of increasing revenue and fiscal deficits in the projected years (2023-24 and 2024-25). These projected deficits significantly exceed the prudent benchmarks set by the FRBM framework for states, indicating a potential deterioration of fiscal health and a move away from fiscal discipline.

Based on the Evidence, the Hypotheses can be Assessed:

H00: There is a positive correlation between sustained capital expenditure and GSDP growth in Chhattisgarh. The analysis generally supports this hypothesis, as periods of increased capital outlay often coincide with or precede periods of robust GSDP growth, aligning with the theoretical expectation of productive spending.

6.2 Overall Conclusion:

Chhattisgarh's fiscal health, while having shown periods of prudence and revenue surplus in the past, appears to be under significant stress in the most recent projected years. The substantial and projected increase in both revenue and fiscal deficits, far exceeding commonly accepted benchmarks, points towards an unsustainable fiscal trajectory. This pattern suggests a growing reliance on borrowing to finance consumption-oriented expenditure, which risks accumulating an unsustainable debt burden and compromising the state's capacity for long-term capital formation and economic development. Without corrective measures, this could lead to reduced fiscal flexibility, higher debt servicing costs, and a potential dampening of future GSDP growth and investment prospects. The interplay between fiscal management and economic growth is evident: prudent fiscal choices, particularly prioritizing quality capital expenditure and maintaining deficit within sustainable limits, are paramount for fostering durable and inclusive economic progress.

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Received on 12.06.2025 Revised on 15.07.2025

Accepted on 01.08.2025 Published on 20.08.2025

Available online from September 02, 2025

Res. J. of Humanities and Social Sciences. 2025;16(3):151-162.

DOI: 10.52711/2321-5828.2025.00027

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License. Creative Commons License.

An Analysis of Fiscal Dynamics and their Impact on Economic Development in Chhattisgarh: A Study of Trends from 2001-2002 to 2024-2025

1.1 Introduction and Background: State Finances and Economic Development in India:

1.2 Research Questions:

1.3 Research Objectives:

1.4 Hypotheses

1.5 RESEARCH METHODOLOGY:

1.6 Expected Outcomes and Significance:

1.7 Limitations:

2: Literature Review on Fiscal Dynamics and Economic Development:

2.3 The Fiscal Responsibility and Budget Management (FRBM) Framework:

2.4 Gaps in Literature and Study's Contribution:

3: Descriptive Interpretation of Chhattisgarh's Financial Data:

3.2 Analysis of Total Expenditure/Outlay:

3.3 Trends in Revenue and Capital Receipts:

3.4 Examination of Revenue and Capital Expenditure:

3.5 Evolution of Deficits (Revenue and Fiscal):

3.6 Observations and Patterns:

4: DATA ANALYSIS AND RESULTS:

4.1 GSDP Growth Performance:

4.2 Expenditure Analysis:

4.3 Receipts Analysis:

4.4 Deficit Analysis:

4.5 Correlation and Relationships:

5: Critical Reasoning and Policy Implications:

5.1 Interpretation of Findings:

5.2 Fiscal Health Assessment:

5.3 Impact on Economic Development:

5.4 Policy Recommendations:

5.4.1 Revenue Augmentation:

5.4.2 Expenditure Rationalization:

5.4.3 Debt Management:

5.4.4 Fiscal Transparency and Accountability:

5.4.5 Sectoral Focus:

5.5 Challenges and Opportunities:

6: CONCLUSION AND SUGGESTIONS:

6.1 Summary of Key Findings:

6.2 Overall Conclusion:

REFERENCES: