Chennai: Interest payments, the largest expenditure of the Central government, for FY25 are estimated to go up by 11 per cent to Rs 11.9 lakh crore against FY24 budget estimate of Rs 10.7 lakh crore.
The budget has allocated Rs 11,90,440 crore towards net interest payments. Interest payments account for 24.98 per cent share of the total budget in FY25 and are higher than 23.5 per cent in FY24.
The interest on internal debt has gone up to Rs 8.78 lakh crore from Rs 7.77 lakh crore in the revised estimate of FY24 and Rs 6.97 lakh crore from the actual of FY23. Market loan interest is the biggest chunk in this segment, accounting for Rs 8.18 lakh crore against Rs 7.29 lakh crore in the revised estimate. Treasury bills are the other major categories.
Interest payment on external debt accounts for Rs 32,597 crore in FY25 against Rs 12254 crore in the FY24 budget estimate and 29911 crore in the revised estimate.
Total interest estimated on small savings schemes, provident funds etc are Rs 2.67 lakh crore. Meanwhile, the Centre would also receive interest on loans extended to state governments. Recoveries and receipts will account for Rs 45,900 crore against Rs 34,000 crore in the FY24 budget estimate.
Interest on green bonds have seen a significant jump from the Rs 23.60 crore in FY23 actual to Rs 1151 crore in the FY24 revised estimate and to Rs 2625 crore in the budget estimate for FY25. Interest on special bonds issued to fertilizer companies has come down from Rs 604 crore in FY24 to Rs 282 crore in FY25.
