Punjab Overtakes Bihar and Haryana in Outstanding Debt; Mizoram Records the Lowest Borrowings

No state in India has remained untouched by the burden of public debt, though the issue often attracts the most political attention in Punjab. As of March 2026, Tamil Nadu has emerged as the country's most indebted state, with outstanding liabilities of ₹10.42 lakh crore. Punjab ranks 12th nationwide, with its total debt reaching ₹4.13 lakh crore during the same period. According to data from the Union Finance Ministry, Punjab's outstanding debt is higher than that of both Bihar and neighbouring Haryana. Bihar's debt stands at ₹4.03 lakh crore, while Haryana's liabilities amount to ₹4.02 lakh crore. In contrast, Mizoram has the lowest debt among the states, with outstanding liabilities of ₹14,516 crore. Among the 28 states, Maharashtra ranks second with ₹9.37 lakh crore in debt, followed by Uttar Pradesh at ₹8.83 lakh crore. Karnataka occupies the fourth position with ₹8.14 lakh crore, while West Bengal has ₹7.90 lakh crore in outstanding liabilities. Gujarat, the home state of Prime Minister Narendra Modi, has debt amounting to ₹5.34 lakh crore. During the past two years, Haryana has raised ₹63,000 crore in fresh borrowings, while Punjab has borrowed ₹67,000 crore. Punjab's total debt had crossed ₹2.82 lakh crore in 2022, and projections indicate that it could rise to ₹4.47 lakh crore by March 31, 2027. According to the Reserve Bank of India's indicative borrowing calendar, the Punjab government plans to raise ₹13,900 crore during the July–September quarter of the current financial year. The state had initially planned to borrow ₹9,500 crore during the first quarter but actually raised around ₹7,800 crore. Borrowing by state governments typically accelerates during election years. With Punjab's Assembly elections approaching, the state government has been borrowing regularly to support development activities. For the current financial year, Punjab intends to raise ₹43,798.38 crore through market borrowings. During the second quarter (July to September), Indian states and Union Territories are collectively expected to borrow ₹3.18 lakh crore, with Punjab accounting for 4.35 percent of the total planned borrowing. Among neighbouring states, Haryana plans to borrow ₹19,000 crore during the second quarter, Rajasthan ₹15,000 crore, Bihar ₹14,000 crore, Gujarat ₹12,500 crore, and Himachal Pradesh ₹2,100 crore. Punjab Finance Minister Harpal Singh Cheema has maintained that the government is borrowing to service the debt inherited from previous administrations and that all borrowings are being made within the prescribed limits. State Debt Snapshot (as of March 2026) Rank State Outstanding Debt 1 Tamil Nadu ₹10.42 lakh crore 2 Maharashtra ₹9.37 lakh crore 3 Uttar Pradesh ₹8.83 lakh crore 4 Karnataka ₹8.14 lakh crore 5 West Bengal ₹7.90 lakh crore 6 Gujarat ₹5.34 lakh crore 12 Punjab ₹4.13 lakh crore — Bihar ₹4.03 lakh crore — Haryana ₹4.02 lakh crore — Mizoram ₹14,516 crore (Lowest in the country)