Last Updated: 5 October 2026
~91% of the debt added since 2022 went to legacy burdens:
-- Interest on old debt
-- Congress-era pending bills
-- Sinking fund investment etc
Debt-to-GSDP cut from 48.25% (2021-22) to 45.1% (2026-27 budget estimate)[1][2]
Interest Rates on loans renegotiated from 11-12% to ~7%[3]
2025-26 Budget: 86% of fresh loans (₹49,900 crore) to go only towards repaying old loans (₹18,199 cr) & servicing legacy debt (₹24,995 cr)[3:1]
-- ₹1.05 lakh crore repaid in 3 years (till 2024-25)
| Additional Debt (Mar 2022 to Mar 2026) | ~₹1.35 lakh crore | 100% |
|---|---|---|
| Interest Payment (2022-26) | ₹94,090 Cr | 69.7% |
| Pending Congress-era Bills (incl. power subsidy arrears, Atta-Dal dues, crop-loan waiver)* | ₹17,245 Cr | 12.8% |
| Arrears paid from Employee pay, pension & DA (Employee DA hike) | ₹4,856 Cr | 3.6% |
| Investment in Sinking Fund | ₹7,000 Cr | 5.2% |
| Total | ₹1,23,191 Cr | 91.3% |
| Date | Debt | Comments |
|---|---|---|
| 31 March 2022 | ₹2.82 lakh crore[4] | Legacy debt |
| 31 March 2025 | ₹3.62 lakh crore[5] | 3 years of AAP |
| 31 March 2026 (projected) | ₹4.17 lakh crore[6] | 4 years of AAP |
| 31 March 2027 (Budget 2026-27 projection) | ₹4.47 lakh crore[7] | 5 years of AAP |
| Additional during AAP rule | ~₹1.65 lakh crore (till Mar 2027, projected) | - |
| Year | Pricipal | Interest | Total |
|---|---|---|---|
| 2022-23 | ₹16,094 Cr[8] | ₹19,905.13 Cr[9] | ₹35,999.13 Cr |
| 2023-24 | ₹17,281 Cr[5:1] | ₹22,551.93 Cr[5:2] | ₹39,832.93 Cr |
| 2024-25 | ₹12,866 Cr[5:3] | ₹23,953.72 Cr[5:4] | ₹36,819.72 Cr |
| 2025-26 | ₹18,200 Cr[10] | ₹27,679 Cr[11] | ₹45,879 Cr |
| 2026-27 Budgeted | - | ₹28,755 Cr[2:2] | - |
| Total Interest (2022-27) | - | ₹122,844.78 Cr | - |
Previous Congress government left atleast Rs 24,351 crore liability/pending payments[12]
-- Rs 13,759 crore unpaid 6th Punjab Pay Commission arrears
-- Rs 7,117 crore of the power subsidy arrears
-- Rs 2,274 crore on account of the Atta-Dal Scheme
-- Rs 1,200 crore of the crop loan waiver
| Pending Bills | Amount | Comments |
|---|---|---|
| Bailout to PUNSUP | ₹350 Cr | Paid during 2022-23 |
| Bailout to PSCADB | ₹798 Cr | Paid during 2022-23 |
| Bailout to RDF | ₹845 Cr* | Paid during 2022-23 & 2023-24 |
| Power Subsidy Arrears | ₹9,020 Cr | Congress-era arrears paid in installments, fully cleared by March 2025 |
| Sugarcane Farmers Arrears | ₹1008 Cr | Paid during 2022-23 & 2023-24 |
| Unpaid Central Schemes | ₹1750 Cr | Paid during 2022-23 |
| Atta-Dal scheme dues* | ₹2,274 Cr | White paper liability, assumed settled[12:1] |
| Crop-loan waiver dues* | ₹1,200 Cr | White paper liability, assumed settled[12:2] |
| Employee pay, pension & DA arrears | ₹4,500+ Cr | Part of ₹14,000 Cr cleared in instalments since 2025 (paid till Sept 2026) |
| 2015 DA instalment (Akali-era) | ₹356 Cr | Paid May 2023 |
| Total | ₹22,101 Cr | - |
* Till Sept 2023
BENEFIT: Lower interest rates on the bonds as High CSF leads to High creditworthiness of Punjab[13]
Total reached 10,000 crore in June 2025, a significant increase from Rs 3,000 crore where previous govt left it[10:1]
| Year | Investment |
|---|---|
| 2022-23 | ₹3000 crore[9:2] |
| 2023-24 | ₹1000 crore*[14] |
| 2024-25 | - |
| 2025-26 | - |
| Total | ₹10,000 crore (2022-25)[10:2] |
*Till Sept 2023
REFERENCES:
https://zeenews.india.com/india/debt-to-gsdp-ratio-reduced-to-44-47-punjab-finance-minister-harpal-singh-cheema-3023363.html (Zee News, 3 Mar 2026; also Outlook Business) ↩︎ ↩︎
https://prsindia.org/files/budget/budget_state/punjab/2026/Budget_Analysis_2026-27-PB.pdf (PRS Budget Analysis 2026-27) ↩︎ ↩︎ ↩︎
https://www.tribuneindia.com/news/punjab/punjab-debt-to-zoom-past-rs-4-lakh-cr-in-2025-26/ ↩︎ ↩︎
https://www.hindustantimes.com/cities/chandigarh-news/punjab-debt-cm-tells-governor-57-of-47-107-cr-loan-spent-on-paying-interest-101696324160628.html ↩︎
https://finance.punjab.gov.in/uploads/26Mar2025/d80520e8-c0cc-470e-9bc0-0abb56785281_20250326133125.pdf ↩︎ ↩︎ ↩︎ ↩︎ ↩︎
https://www.tribuneindia.com/news/punjab/punjabs-debt-crosses-rs-4-lakh-crore/ (Tribune, 4 Mar 2026) ↩︎
https://www.tribuneindia.com/news/punjab/punjab-budget-liabilities-to-consume-91-of-income/ ↩︎
https://finance.punjab.gov.in/uploads/05Mar2024/Budget_At_A_Glance.pdf ↩︎
https://www.babushahi.com/full-news.php?id=172087 (Punjab Govt Press Release) ↩︎ ↩︎ ↩︎
https://www.babushahi.com/view-news.php?id=206808&headline=Punjab-posts-record-44.44-%-GST-growth-in-June;-highest-ever-Q1-revenue-surge-at-27.01-% (Punjab Govt Press Release) ↩︎ ↩︎ ↩︎
https://prsindia.org/budgets/states/punjab-budget-analysis-2026-27 (PRS, Punjab Budget 2026-27: 2025-26 revised estimates) ↩︎
https://timesofindia.indiatimes.com/city/chandigarh/punjab-in-debt-trap-of-rs-2-63-lakh-crore-congress-handed-over-immediate-liability-of-rs-24351-crore/articleshow/92456033.cms ↩︎ ↩︎ ↩︎
https://www.legalserviceindia.com/legal/article-2730-explained-consolidated-sinking-fund.html ↩︎
https://www.tribuneindia.com/news/punjab/punjabs-revenue-receipts-fall-10-in-2023-24-620557 ↩︎
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