With less than three months remaining before the fiscal year ends, officials said they were confident of fully utilising the allocation.
“The finance minister is personally monitoring progress under the scheme, and we are confident of achieving the target,” a senior government official told ET.Also Read: Govt to achieve fiscal deficit target of 4.4% in FY26, may even better it, says PwC
Under the scheme, the Centre provides 50-year interest-free loans to states to boost capital expenditure. A portion of the assistance is linked to the implementation of specific reforms, while the remainder is untied, giving states flexibility in selecting projects. Launched during the Covid-19 pandemic to support capital spending at a time of revenue stress and subdued private investment, SASCI has since become a central pillar of the government’s growth strategy. The annual outlay has risen sharply from ₹2,000 crore in 2020-21 to ₹1.50 lakh crore in the current fiscal.
Disbursements under the scheme have increased steadily, touching nearly ₹1.49 lakh crore in FY25, with around half the funds linked to reform milestones. Since its launch in October 2020, cumulative releases under SASCI have reached ₹4.49 lakh crore, covering the period from 2020-21 to 2025-26 (till January 5).
Of the total allocation for 2025-26, ₹70,000 crore has been earmarked as untied assistance, allowing states to propose capital projects of their choice. The remaining ₹80,000 crore is linked to sector-specific reforms, including mining reforms, vehicle scrappage and electronic enforcement of road safety, land-related reforms in rural areas, and the creation of digital public infrastructure for agriculture.
