The CAG’s report on the finances of the Delhi government examined its overall financial position, expenditure pattern, debt position and compliance with fiscal responsibility. The assessment covered the period when the Aam Aadmi Party (AAP) was in power in Delhi. 
According to the report, Delhi’s GSDP stood at INR 12.15 lakh crore in 2024-25, registering a growth of 9.17 per cent over the previous financial year. The report described the economic growth and GSDP trend during the year as healthy. Delhi accounted for 3.67 per cent of India’s GDP during the year. 
GSDP measures the value of goods and services produced within a state or Union Territory, while GDP measures the value of economic output at the national level. The comparison of the two provides an indication of how a regional economy is performing against the country as a whole. 
The CAG, however, pointed to a longer-term decline in Delhi’s contribution to the national economy. Delhi’s share of India’s GDP fell from 4 per cent in 2015-16 to 3.67 per cent in 2024-25. This indicates that while Delhi’s economy continued to expand in absolute terms, its growth was not keeping pace with the overall expansion of the Indian economy. 
The report also noted that Delhi’s per capita GSDP grew at a compound annual growth rate of 6.39 per cent between 2015 and 2025, compared with 8.14 per cent annual growth in India’s per capita GDP during the same period. 
Delhi continued to have a much higher per capita economic output than the national average, but the gap narrowed over the period. The per capita GSDP of the National Capital Territory was 177.07 per cent higher than India’s per capita GDP in 2015-16. By the end of 2024-25, the difference had reduced to 135.34 per cent. The CAG said this reflected slightly slower economic growth in Delhi compared with the rest of the country. 
The fiscal position also showed mixed trends. Revenue receipts of the Delhi government increased by 9.57 per cent, supported mainly by higher tax collections, with Goods and Services Tax (GST) being a major contributor. At the same time, non-tax revenue declined by 11.04 per cent and grants received from the Centre also fell. 
A major concern highlighted in the report was the composition of government expenditure. Revenue expenditure accounted for a large share of spending, with committed expenditure and subsidies putting pressure on the government’s available fiscal space for capital investment. 
Subsidy spending increased by INR 3,222 crore, or 172.48 per cent, during the 2015-25 period. Power subsidies accounted for a major part of this increase, rising by INR 2,033 crore, or 128.83 per cent. 
The CAG also highlighted the decline in capital expenditure over the period. Capital expenditure remained between 7 per cent and 15 per cent of total expenditure during the 10-year period, indicating constraints on infrastructure investment and capital formation. 
Capital expenditure fell to INR 3,695 crore in 2024-25 from INR 6,855 crore in 2023-24. The report attributed the decline partly to lower spending on areas including roads and bridges and road transport. 
The findings are relevant for Delhi’s infrastructure requirements, as capital expenditure is the part of government spending that directly supports the creation and improvement of public assets. A sustained reduction in such spending can limit the government’s ability to expand infrastructure while a larger share of expenditure is committed to recurring costs. 
Delhi’s GSDP of INR 12.15 lakh crore also places it among India’s largest regional economies. The Reserve Bank of India’s state-level data places Delhi among the top 10 economies by GSDP for 2024-25. 
The CAG findings therefore point to two different aspects of Delhi’s economy. The city continues to generate a large economic output and recorded healthy GSDP growth during the year, but its share in the national economy has declined over the longer term. At the same time, the government’s expenditure pattern shows increasing pressure from subsidies and revenue spending, while capital expenditure has weakened. 
Source PTI