Exclusive | Maharashtra Budget 2025: Rs 1 lakh crore cut expected amid revenue crunch

Mantralaya sources tell mid-day that Budget 2025, to be presented in March, might see a cut of up to Rs 1 lakh crore amid Maharashtra’s revenue woes; According to Mantralaya officials, Maharashtra Finance Minister Ajit Pawar has already begun streamlining the state’s finances and creating a roadmap to reduce debt

The Maharashtra government is preparing for significant spending cuts in its 2025 budget, set to be presented in March. Finance department officials say the reductions could total thousands of crores, possibly reaching Rs 1 lakh crore.

According to Mantralaya officials, Maharashtra Finance Minister Ajit Pawar has already begun streamlining the state’s finances and creating a roadmap to reduce debt.

During budget review meetings, Pawar keeps stressing the need for a plan to cut the state's debt,” an official said on condition of anonymity.

Although the state expects revenue increase for FY25—from Rs 4.49 lakh crore to Rs 4.99 lakh crore, a 12 per cent rise—the growth won't be enough to cover rising expenses, particularly welfare schemes. Currently, 50 per cent of the state's revenue is spent on salaries, pensions, and interest payments. Maharashtra’s total debt has already crossed Rs 7.11 lakh crore and is expected to rise further if timely action is not taken.

With the state struggling to balance revenue and expenditure, the Mukhyamantri Majhi Ladki Bahin Yojana—which provides Rs 1500 per month to women—has added a Rs 46,000 crore burden. The Centre’s PM Kisan scheme is another financial strain, costing Maharashtra R5500 crore annually to support 9.4 million farmers with Rs 6000 each.

During the Assembly elections, the government also promised to increase the allowance under the scheme to Rs 2100, adding further pressure on the budget. “The state is facing an uphill task as spending continues to outpace revenue. The concern is growing as expenditure is rising rapidly compared to income,” said a former bureaucrat.

Retired IAS officer Mahesh Zagade admitted that state finances are spiralling out of control. “Welfare schemes should be productivity-oriented, not just populist,” he said.

Discussing budget trends, Zagade added, “Earlier, the budget was a vision document. Today, it’s just a numbers game.”

A senior Mantralaya official, speaking anonymously, also warned that without corrective action, Maharashtra will struggle to balance revenue and spending. “The government has limited options: cutting development program funds, imposing restrictions, or increasing borrowing,” he said.

Pawar has already urged all ministers and departments to reduce expenditure this fiscal year. “The cabinet, too, is convinced that tough decisions are necessary to streamline the state's fiscal position,” the official added. 

Rs 1500
Amount promised to women in state per month

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