Odisha has budgeted a record ₹72,100 crore as capital outlay for the financial year 2027 (FY27) – around 20 per cent higher than the revised estimate of ₹60,153 crore for FY26. However, only ₹11,300 crore (15.7 per cent) of the annual provision has been spent by July end.
Even as the capital outlay is 6.5 per cent of its GSDP – the highest among all major Indian states – Odisha continues to lag in utilisation. It was among the bottom states in Q1FY27.
According to the Budget data, ₹21,468 crore, including ₹17,293 crore as capital outlay, has been earmarked for roads and bridges, while irrigation and flood control have been allocated ₹17,855 crore. Water supply and sanitation have received
Together, these sectors account for a major portion of the state’s infrastructure spending and have direct implications for connectivity, agricultural productivity, urbanisation and industrial investment.
Officials said Odisha could struggle to fully utilise its record ₹72,100 crore capital outlay unless government departments accelerate project execution and spending in the coming months.
With only ₹11,300 crore spent in the first four months, the state would need to spend roughly ₹60,800 crore over the remaining eight months. “If Odisha continues with the same pace of expenditure, it may end up utilising only 60-70 per cent of the capex by the FY end,” they said.
During the recent all-secretaries meeting, Anu Garg, chief secretary, has directed all departments to expedite expenditure and ensure full utilisation of budgetary provisions, with a special focus on capital spending. Business Standard has reviewed the meeting proceedings.
Stressing infrastructure-led growth, Garg asked department heads to implement measures promptly through continuous monitoring and to ensure timely utilisation of funds.
Departments have also been instructed to expedite capex for availing a major share under Special Assistance as Loan to States for Capital Expenditure (SASCI) and submit utilisation certificates on time to secure maximum central grants.
Under Part-III of the SASCI 2026-27, Odisha can access an incentive of ₹552.5 crore if it achieves more than 10 per cent growth in capital expenditure during April-September 2026 over the corresponding period of 2025-26.
According to the review by the chief secretary, the state needs to achieve capital expenditure of around ₹21,500 crore by the end of September to avail the incentive. The Centre’s SASCI programme is important for states like Odisha as it provides interest-free long-term financial support for capital expenditure. Around ₹2 trillion has been earmarked under SASCI in the Union Budget this financial year.
The state has already secured 233 projects involving ₹2,961 crore under Part-I of SASCI FY27 for the Works, Water Resources, Rural Development and Energy departments. Of this, ₹1,954 crore has been released. The departments have been advised to furnish utilisation certificates showing 75 per cent utilisation of the funds released in the first instalment so that they become eligible for the second instalment.
The total expenditure excluding debt servicing and disaster management stood at ₹58,996 crore by July end. Programme expenditure was ₹35,438 crore, while the spending on establishment, operation and maintenance stood at ₹23,558 crore. The state had presented a Budget of ₹3.1 trillion for FY27.
