India’s just-in-time funds release system has led to interest cost savings of nearly ₹26,000 crore since FY18, Finance Minister Nirmala Sitharaman announced on Saturday. The Treasury Single Account System (TSA) for autonomous bodies and the Single Nodal Agency (SNA) model for states have allowed the government to link borrowings directly to actual requirements, reducing excess fund float and improving fiscal efficiency.
Speaking at the 49th Civil Accounts Day celebrations, Sitharaman lauded these financial reforms, emphasizing that better fund tracking and real-time analysis have helped optimize public borrowing and minimize financial waste.
Efficient Fund Management Through TSA and SNA
With the implementation of the Central Nodal Agency (CNA) for central sector schemes, SNA for centrally-sponsored schemes, and TSA for autonomous bodies, the government can now track fund flows down to the last user.
By linking all payment systems to the Public Financial Management System (PFMS), the government can ensure that no new funds are allocated until previously released funds are utilized. This approach has led to better fiscal discipline and reduced unnecessary borrowing.
- TSA implementation alone has saved over ₹15,000 crore in interest costs since FY18.
- SNA has saved ₹11,000 crore since FY22 by consolidating funds from over 1.5 million bank accounts into 4,500 bank accounts, improving transparency and efficiency.
“The just-in-time fund release mechanism ensures that we don’t borrow more than we need, reducing the financial burden on future generations,” Sitharaman stated.
India on Track to Become a Developed Nation by 2047: Panagariya
At the same event, 16th Finance Commission Chairman Arvind Panagariya stated that, based on India’s economic growth trajectory, the country is well-positioned to become a developed nation by 2047.
India’s high growth rate since 2003-04, averaging 7.8% annually in constant dollar terms and 10.1% in current dollar terms, indicates strong momentum toward achieving high-income status as per World Bank criteria.
Currently, a high-income economy is defined as a country with a gross national income (GNI) per capita of $14,005 or more. If India maintains its current growth trajectory, it is expected to meet this benchmark by 2047-48.
Also read: India Leads AI Adoption and Governance, Says Sitharaman
A More Transparent and Accountable Financial System
The government’s financial management reforms have not only improved fiscal discipline but also enhanced transparency and efficiency in fund utilization. By ensuring that funds are used before fresh disbursements, India is optimizing its financial resources while keeping its borrowing in check.
As the country moves towards its economic aspirations for 2047, initiatives like just-in-time fund allocation and real-time financial tracking will play a crucial role in shaping India’s fiscal future and ensuring sustainable economic growth.
