India Ratings & Research (Ind-Ra) has projected the aggregate fiscal deficit of states to rise to 3 per cent of gross domestic product (GDP) in 2026-27 (FY27), from an estimated 2.8 per cent in 2025-26 (FY26), citing higher revenue expenditure amid election-related pressures and scheme cost-sharing requirements. However, if funds under the Scheme for Special Assistance to States for Capital Investment (SASCI) worth Rs 1.85 trillion are included, the fiscal deficit is expected to increase to 3.5 per cent of GDP in FY27 from an estimated 3 per cent in FY26.