The Union finance ministry will hold a two-day conference of state finance ministers and finance secretaries beginning Friday.
The conference will bring together the Centre and states to discuss financing priorities for India’s development journey, including the implications of goods and services tax (GST) reforms, agricultural transformation and the energy transition, according to a finance ministry statement released on Thursday.
The conference, titled “Financing India’s Journey towards Viksit Bharat”, comes ahead of the 7 October meeting of the Council and the formal start of pre-budget meetings for the Union Budget 2027-28 from 12 October. The pre-budget meetings are scheduled to continue until mid-November.
Beginning of the budget cycle
The timing is significant for states as they prepare their own budgetary and financing priorities while the works on the next Union budget. In the previous budget cycle, the finance minister held a pre-budget consultation with states and Union territories in January, during which states raised issues, including continued support for capital investment. To be sure, this meeting is not a pre-budget consultation.
The conference will focus on policy complementarities between the Centre and states and deliberate on financing challenges and policy priorities for India’s development journey, the ministry said.
The timing is also significant as the Centre and states seek to balance development spending with fiscal consolidation. The Union government has pegged its fiscal deficit target at 4.3% of gross domestic product (GDP) for FY27, down from 4.4% in FY26, as part of its debt-consolidation path.
At the same time, inflationary pressures have begun to warrant closer attention. India’s retail inflation rose to a 20-month high of 4.82% in August, driven by higher food and fuel prices, moving above the Reserve Bank of India’s 4% target midpoint for the third consecutive month.
Against this backdrop, discussions on financing infrastructure, agriculture and the energy transition could assume greater importance, particularly as states remain key drivers of public capital expenditure.
Several chief ministers and finance ministers, along with senior state officials, are expected to participate. Union finance and corporate affairs minister will also be present, the ministry said.
The implications of for states will be among the issues discussed at the conference, making it particularly relevant ahead of the GST Council’s October meeting, it said.
The 56th GST Council meeting in September 2025 approved a major restructuring of GST rates, with the revised rates taking effect from 22 September 2025. The new structure primarily moved to 5% and 18% slabs, alongside a 40% rate for specified luxury and sin goods.
The conference will therefore provide a forum for discussions on how the GST changes affect state finances, alongside broader questions around financing development priorities, it said.
On agenda
The conference will have three thematic sessions covering the macroeconomic outlook, financing agricultural transformation and financing the energy transition.
Background papers circulated among participants will examine how India can mobilize financing for its development priorities, according to the statement. The papers cover macroeconomic milestones and pathways towards Viksit Bharat, private financing, implications of GST 2.0 for states, financing agricultural markets and marketing, resilience and sustainable resource use in agriculture, renewable energy and transmission assets, and carbon capture, utilization and storage, among other areas.
Department of economic affairs secretary Anuradha Thakur will outline the objectives of the conference at the inaugural session, while N.K. Singh, president and life trustee of the Institute of Economic Growth and chairman of the 15th Finance Commission, will deliver the keynote address. Also, former Maharashtra additional chief secretary and finance secretary Sudhir Shrivastava will present the state perspective on financing Viksit Bharat.
The conference will also look at how development outcomes are measured and how technology can support governance. MoSPI secretary Saurabh Garg will highlight the importance of measuring growth outcomes in India’s journey towards Viksit Bharat, while MeitY secretary S. Krishnan will discuss the role of new-age technology in good governance.
“The state debt-to-GDP is way above the targeted 20% in the fiscal consolidation roadmap, while the central debt-to-GDP inches towards the targeted 40%. Containing the debt-to-GDP is an imperative, given it has a bearing on the sovereign credit rating as well as the cost of government borrowings,” said Ranen Banerjee, partner and leader, economic advisory, PwC India.
“It will be welcome to see the state and the Centre deliberate on the financing gap as well as newer sources of revenue generation. Financing the energy mix transition, logistics infrastructure, and agricultural infrastructure that are critical to creating jobs in the farm sector is imperative. It will be important for states and the Centre to align on the debt consolidation path and quality of budget expenditure so that while it continues to finance the capital outlays, it does not crowd out private borrowings with excessive borrowings for revenue spends,” said Banerjee.