Many state governments keep money aside in reserve funds, like savings, so they can repay debt and manage emergencies. RBI data shows how much each state has saved and invested.
States Invest Huge Funds to Manage Debt and Emergency Needs
The RBI Bulletin December 2025 data provides a powerful reflection of how states are maturing in fiscal behavior. The leaders of this investment landscape — Maharashtra, Karnataka, Uttar Pradesh, Odisha and Bihar — are effectively demonstrating how surplus funds and reserves can be deployed strategically across long-term reserves, guarantee buffers and short-term cash instruments.
Why State Government Investments Matter
Indian state governments don’t just collect revenue and spend it — they also invest surplus funds strategically to strengthen fiscal stability, reduce debt risk, and prepare for contingent liabilities. The Reserve Bank of India (RBI) Bulletin December 2025 provides a clear view of how state governments and select Union Territories deployed their investible balances as on end of October 2025, through three key channels:
- Consolidated Sinking Fund (CSF) – a reserve pool meant to help states repay debt and reduce borrowing pressure over time.
- Guarantee Redemption Fund (GRF) – a safeguard to meet obligations when guarantees given by state governments are invoked.
- Auction Treasury Bills (ATBs) – short-term safe investments made through Treasury Bill auctions, mainly used for parking surplus cash efficiently.
Interestingly, the RBI table shows zero investment in Government Securities during this period for all states/UTs included in the dataset.
Total Investments Touch ₹4.39 Lakh Crore
State governments collectively parked a massive ₹4,39,678 crore across CSF, GRF and ATBs, showing that state treasuries are not passive. They actively use investment mechanisms to protect long-term fiscal sustainability and manage short-term cash flows effectively.
All-India Total (As on End Oct 2025)
- CSF Total: ₹2,63,427 crore
- GRF Total: ₹26,536 crore
- Government Securities: ₹0
- ATBs Total: ₹1,49,715 crore
- Overall Total (CSF + GRF + ATBs): ~₹4,39,678 crore
What the Big Picture Indicates
This data clearly signals a dual strategy by many states:
- CSF reflects fiscal discipline — states setting aside resources for future debt repayment.
- ATBs reflect treasury efficiency — states parking surplus liquidity for short periods while still earning safe returns.
- GRF reflects risk preparedness — states building buffers against guarantee-related liabilities.
This mix tells us something important: states are increasingly behaving like structured financial managers, not just spending entities.
Top 10 States by Total Investments (As on End October 2025)
| Rank | State | Total Investments (₹ Crore) |
|---|---|---|
| 1 | Maharashtra | 77,064 |
| 2 | Karnataka | 64,243 |
| 3 | Uttar Pradesh | 53,308 |
| 4 | Odisha | 42,633 |
| 5 | Bihar | 32,081 |
| 6 | West Bengal | 25,200 |
| 7 | Chhattisgarh | 22,351 |
| 8 | Gujarat | 19,277 |
| 9 | Andhra Pradesh | 13,403 |
| 10 | Punjab | 11,563 |
Top 10 State Analysis: What Their Patterns Reveal
1. Maharashtra
India’s Biggest CSF Reserve Builder
Maharashtra tops the list with ₹73,818 crore in CSF and ₹3,246 crore in GRF, totaling ₹77,064 crore, with no ATB investments. This is a powerful signal that Maharashtra strongly prefers structured long-term reserve building over short-term liquidity parking. In simple terms, Maharashtra behaves like a state that plans for future liabilities, especially debt repayment, with deep discipline.
2. Karnataka
India’s King of Short-Term Cash Parking
Karnataka ranks second but dominates in a specific area: ATBs at ₹41,160 crore, the highest in India. Alongside CSF ₹21,322 crore and GRF ₹1,761 crore, Karnataka’s investment behavior highlights large short-term surplus cash holdings, likely due to timing gaps between revenue receipts and scheduled spending. Karnataka’s pattern suggests both treasury strength and active cash-flow optimization.
3. Uttar Pradesh
Highest GRF, Strong CSF and Huge ATBs
Uttar Pradesh is the most significant state in the risk-buffer category, with the highest GRF in the country at ₹5,539 crore. Add CSF ₹22,769 crore and ATBs ₹25,000 crore, and UP’s total becomes ₹53,308 crore. This reflects a state that is building protection against guarantee-related risk, while simultaneously handling large liquidity balances through short-term instruments.
4. Odisha
One of India’s Most Balanced and Disciplined Investors
Odisha holds CSF ₹19,216 crore, GRF ₹2,157 crore, and ATBs ₹21,260 crore, totaling ₹42,633 crore. Odisha appears to be a model case of balance: investing heavily in both long-term reserves and short-term cash management. This suggests strong fiscal planning, predictable spending, and stable treasury operations.
5. Bihar
Strong ATB Deployment with CSF Support
Bihar has ATBs of ₹16,000 crore and CSF ₹15,088 crore, totaling ₹32,081 crore. Such a pattern suggests Bihar is parking large cash balances in short-term instruments while also building long-term debt repayment buffers. This may also indicate staggered expenditure cycles and careful cash-flow handling.
6. West Bengal
Strong CSF with Significant Liquidity Parking
West Bengal reports CSF ₹15,061 crore, GRF ₹1,139 crore, and ATBs ₹9,000 crore. This combination indicates West Bengal is actively managing both long-term reserve discipline and liquidity parking.
7. Chhattisgarh
A Solid Multi-Channel Investor
Chhattisgarh’s total of ₹22,351 crore includes CSF ₹8,667 crore, GRF ₹1,008 crore, and ATBs ₹12,676 crore. This shows an impressive combination of discipline and liquidity management. Chhattisgarh’s strategy suggests fiscal caution and structured use of investment tools.
8. Gujarat
High CSF, Low ATB – Conservative Liquidity Strategy
Gujarat shows CSF ₹16,075 crore, GRF ₹702 crore, and ATBs just ₹2,500 crore. This is a state that relies more on long-term reserve building than short-term parking. Such patterns often align with stable revenue management and planned expenditure execution.
9. Andhra Pradesh
Strong CSF with Moderate GRF, No ATB
Andhra Pradesh reports CSF ₹12,201 crore and GRF ₹1,202 crore with no ATB investments. The absence of ATBs could mean limited surplus cash availability or a policy preference. Still, the CSF and GRF levels show disciplined reserve building.
10. Punjab
Long-Term Reserve Focus, Limited Liquidity Parking
Punjab totals ₹11,563 crore, entirely from CSF ₹10,585 crore and GRF ₹978 crore, with no ATBs. This suggests Punjab is focusing more on long-term reserve provisions rather than short-term cash parking, which may also reflect tighter cash conditions.
State-Wise Trends: What Different States Are Signaling Through Their Investments
Beyond the top 10, the RBI data reveals distinct behavioral clusters:
A. States That Prefer Long-Term Discipline (High CSF, Low ATB)
These states appear to focus on debt preparedness rather than cash parking.
Examples include Maharashtra, Gujarat, Punjab, Assam, Telangana, and Uttarakhand. Their investment patterns suggest structured debt management and possibly stable cash flow cycles.
B. States That Actively Park Surplus Liquidity (High ATB)
States like Karnataka, Odisha, Uttar Pradesh, Bihar, Chhattisgarh, West Bengal, and even smaller entities like Arunachal Pradesh show high ATBs, indicating substantial short-term surplus balances and a treasury-driven approach to fund management.
C. States with Strong Guarantee Risk Buffers (High GRF)
UP leads this category, but some states like Telangana, Haryana, Rajasthan, and Maharashtra also show sizeable GRF values.
A strong GRF typically indicates either higher guarantee exposure or policy-driven contingent liability planning.
D.States/UTs with Low Investment Scale
Smaller states/UTs such as Mizoram, Meghalaya, Tripura, Manipur, and J&K show low investment amounts.
This reflects smaller fiscal volume and limited surplus capacity rather than necessarily poor financial planning.
E. States Not Participating in CSF/GRF Schemes
Some states show “-” values for CSF/GRF, indicating non-membership or absence of these funds in the scheme framework. Example: Himachal Pradesh, and partially Jharkhand, Madhya Pradesh, Puducherry, and Tamil Nadu where one or both categories are absent.
Key Findings: Four Big Insights from RBI Data
1. CSF Dominates Overall Investments
More than ₹2.63 lakh crore in CSF confirms that state governments are building long-term financial buffers, especially for future debt repayment.
2. Treasury Bills Show Heavy Cash Surplus Parking
ATBs crossing ₹1.49 lakh crore highlight that multiple states are sitting on large cash balances, at least temporarily, and are using safe instruments to generate returns while waiting to deploy funds.
3. GRF is Still Concentrated, Not Universal
While total GRF is ₹26,536 crore, it is highly concentrated in a few states. Many states have low GRF or do not report it. This suggests the concept of guaranteed-risk provisioning is still not equally institutionalized across India.
4. Government Securities Investment is Zero in Reporting
The data indicates no state-level investments in Government Securities, which is either a reflection of state preference shifting toward CSF/ATBs or a reporting scope limitation of this particular RBI dataset.
State-Wise Report (All States & UTs Covered)
1. Andhra Pradesh
Stable Reserve Contributor, No Short-Term Parking
Andhra Pradesh reports ₹12,201 crore in CSF and ₹1,202 crore in GRF, but no ATB investments.
This profile suggests Andhra Pradesh is prioritizing reserve building for debt repayment and guarantee obligations rather than parking excess cash in Treasury Bills. It may reflect either a cautious long-term strategy or limited surplus liquidity. CSF strength signals intent toward fiscal sustainability, while GRF indicates preparedness for contingent risks arising from guarantees.
2. Arunachal Pradesh
Low CSF, Nearly Full Dependence on Treasury Bills
Arunachal Pradesh has ₹3,101 crore CSF, ₹8 crore GRF, and ₹8,000 crore ATBs, showing dominance of ATB investments.
The high ATB component indicates short-term investment behavior, possibly due to irregular inflows and expenditure timing. The extremely small GRF suggests limited guarantee risk provisioning. This investment pattern reflects a treasury-first liquidity approach rather than strong long-term debt reserve planning.
3. Assam
Strong CSF Discipline, Minimal Risk Buffer
Assam maintains ₹8,176 crore CSF and ₹95 crore GRF, with no ATBs.
Assam’s focus appears strongly on debt reserve creation through CSF, which is a positive indicator for long-term fiscal management. However, limited GRF means the state is less insulated from guarantee-related liabilities. The absence of ATBs can imply low temporary surplus or deliberate avoidance of short-term investments.
4. Bihar
Balanced Model with Strong ATB Usage
Bihar holds ₹15,088 crore CSF, ₹993 crore GRF, and ₹16,000 crore ATBs.
Bihar’s investment strategy is a good mix of long-term reserve creation and short-term liquidity investments. Large ATB placements indicate significant cash balances parked temporarily. This may reflect delayed expenditure cycles or staged fund releases. The CSF base supports debt servicing readiness, while GRF remains moderate.
5. Chhattisgarh
Strong Multi-Channel Reserve Strategy
Chhattisgarh has ₹8,667 crore CSF, ₹1,008 crore GRF, and ₹12,676 crore ATBs.
The state shows strong fiscal preparedness and liquidity discipline. High ATBs indicate proactive treasury operations, while a sizeable CSF reflects long-term debt planning. GRF presence strengthens protection against contingent liabilities. Chhattisgarh’s model resembles a fiscally cautious state investing for both short-term and long-term stability.
6. Goa
Small CSF but Strong GRF Relative to Size
Goa reports ₹1,183 crore CSF and ₹482 crore GRF, with no ATBs.
Goa’s relatively high GRF compared to CSF suggests the state is more cautious about guarantee-related risks. Absence of ATBs reflects limited excess cash balances or a strategic focus on reserves rather than short-term investment. This profile indicates a risk-aware approach despite smaller fiscal scale.
7. Gujarat
High CSF Builder, Conservative Liquidity Parking
Gujarat invests ₹16,075 crore in CSF, ₹702 crore in GRF, and ₹2,500 crore in ATBs.
Gujarat prioritizes long-term fiscal strength through CSF. Low ATBs suggest surplus funds are not heavily parked short-term, indicating more stable expenditure cycles. GRF remains moderate, hinting that Gujarat either has controlled guarantees or relies on broader fiscal capacity to manage contingent liabilities.
8. Haryana
High GRF Compared to CSF – Guarantee-Focused Risk Buffer
Haryana has ₹2,747 crore CSF but a high ₹1,798 crore GRF, with no ATBs.
Haryana’s unusually high GRF relative to CSF indicates significant attention to guarantee risk coverage. This could imply a larger guarantee portfolio or a policy-driven focus on contingent liability preparedness. Absence of ATB suggests limited temporary surplus or policy restriction on short-term investments.
9. Himachal Pradesh
Not a Member of the CSF/GRF Scheme
Himachal Pradesh shows “-” for CSF and GRF and has no ATBs. The “-” indicates the state is not a participant in the scheme. This does not automatically imply poor fiscal management, but it does suggest the state is not using RBI-linked structured reserve systems. This may reduce transparency of reserve discipline compared to member states.
10. Jammu & Kashmir (UT)
Very Low Reserve Holding
J&K UT reports ₹56 crore CSF and ₹55 crore GRF, with no ATBs.
The low level reflects small-scale reserve operations. The near-equal CSF and GRF indicate balanced reserve behavior, but the absolute volume is minimal. This could be due to fiscal structure, UT funding dependence, or limited surplus capacity.
11. Jharkhand
CSF Present, GRF Not Reported
Jharkhand has ₹3,154 crore CSF but GRF is “-”.
The absence of GRF suggests either non-participation in that segment or no maintained balance. CSF presence indicates partial structured reserve discipline. The lack of ATBs suggests limited surplus liquidity management through Treasury bills.
12. Karnataka
Highest ATB Investor in India
Karnataka reports ₹21,322 crore CSF, ₹1,761 crore GRF, and ₹41,160 crore ATBs.
Karnataka dominates ATB investment, indicating large short-term cash balances parked frequently. This could reflect strong revenue inflows or delayed spending schedules. It balances this with substantial CSF, reflecting long-term debt discipline. Karnataka’s investment structure signals both treasury strength and systemic reserve planning.
13. Kerala
CSF Only, No GRF and No ATB
Kerala has ₹3,396 crore CSF, zero GRF, and no ATBs. The absence of GRF suggests Kerala may not be using guarantee buffering actively. CSF presence indicates some debt reserve planning, but the total is moderate. Lack of ATB indicates limited short-term liquidity parking or constrained surplus.
14. Madhya Pradesh
GRF Present, Minimal ATB, No CSF Membership
MP shows “-” for CSF, ₹1,342 crore GRF, and ₹1,500 crore ATBs.
Madhya Pradesh focuses more on guarantee risk provisioning than sinking fund reserves. ATB investment is moderate, implying occasional surplus. Absence of CSF suggests non-membership. The combination indicates MP prioritizes contingent liability management over structured debt reserve planning.
15. Maharashtra
India’s Largest CSF Investor
Maharashtra holds ₹73,818 crore CSF and ₹3,246 crore GRF, with no ATBs.
Maharashtra is clearly the strongest reserve-building state in India. Massive CSF indicates extraordinary commitment to debt repayment security. Lack of ATB suggests the state does not rely on temporary surplus parking, possibly due to stable high expenditure cycles or strong institutional cash planning.
16. Manipur
Low CSF but Strong GRF Relative to CSF
Manipur reports ₹73 crore CSF and ₹148 crore GRF, no ATBs.
GRF being higher than CSF reflects greater concern for guarantee-related risks than for debt reserve building. This may indicate a guarantee exposure or policy-driven provisioning. Overall investment volume remains very low, limiting broader interpretation.
17. Meghalaya
Small Reserve Builder
Meghalaya has ₹1,341 crore CSF and ₹114 crore GRF.
Meghalaya’s structure reflects moderate reserve behavior. The presence of both funds indicates scheme participation and fiscal discipline, though the total size is limited compared to larger states. No ATB indicates limited cash surplus parking.
18. Mizoram
Low Reserve Volume but Balanced
Mizoram reports ₹531 crore CSF and ₹84 crore GRF, no ATBs.
Mizoram’s investments indicate limited fiscal scale, but the balance between CSF and GRF suggests structured participation and awareness of debt and guarantee risks. Absence of ATBs indicates limited liquidity surplus.
19. Nagaland
Moderate CSF, Low GRF
Nagaland has ₹1,997 crore CSF and ₹49 crore GRF.
The CSF is stronger than several small states, reflecting higher reserve accumulation for debt repayment. GRF is low, indicating limited guarantee exposure or weaker provisioning. No ATBs suggests minimal surplus cash management via Treasury bills.
20. Odisha
One of India’s Best Balanced Investors
Odisha holds ₹19,216 crore CSF, ₹2,157 crore GRF, and ₹21,260 crore ATBs.
Odisha reflects ideal reserve and liquidity balance. Strong CSF provides debt stability, and substantial ATBs show short-term investment capacity. This indicates strong treasury management and potentially disciplined budgeting. The state emerges among the top fiscal performers in terms of investment structuring.
21. Puducherry (UT)
Small CSF, ATB Use Present, GRF Not Reported
Puducherry shows ₹611 crore CSF, GRF as “-”, and ₹2,350 crore ATBs. Puducherry appears to rely more on short-term treasury parking than long-term reserves. The absence of GRF may indicate low guarantee provisioning. ATB exposure suggests available surplus cash that is strategically invested in safe instruments.
22. Punjab
Strong CSF, No ATB Strategy
Punjab holds ₹10,585 crore CSF and ₹978 crore GRF, with zero ATBs. Punjab’s focus on structured reserves rather than liquidity parking indicates either constrained surplus or policy preference for long-term reserve discipline. CSF strength is significant, suggesting long-term debt servicing intent. GRF is moderate, indicating risk buffering exists but not at high scale.
23. Rajasthan
ATB Use with Moderate CSF and GRF
Rajasthan reports ₹2,960 crore CSF, ₹1,457 crore GRF, and ₹5,550 crore ATBs.
Rajasthan maintains a multi-channel investment approach. High ATBs indicate active liquidity management, while GRF is strong relative to CSF, suggesting higher guarantee provisioning. This structure indicates the state is concerned with both short-term cash and contingent liabilities.
24. Tamil Nadu
Strong ATB Investor, CSF Present, GRF Not Reported
Tamil Nadu has ₹3,625 crore CSF and ₹4,718 crore ATBs, GRF “-”.
Tamil Nadu relies more on ATBs than CSF, implying significant short-term cash reserves. Absence of GRF suggests low guarantee provisioning or non-reporting. This pattern reflects treasury strength but may require stronger long-term reserve discipline if debt obligations grow.
25. Telangana
Strong CSF and High GRF – No ATB
Telangana invests ₹8,321 crore in CSF and ₹1,826 crore in GRF, no ATBs.
Telangana demonstrates strong reserve discipline, and GRF is relatively high, indicating awareness of contingent risk. The absence of ATBs could mean surplus liquidity is limited, or it prefers internal cash deployment. Overall, Telangana appears structurally cautious and fiscally prepared.
26. Tripura
Low Reserves, Minimal GRF
Tripura reports ₹1,387 crore CSF and ₹31 crore GRF, no ATBs.
Tripura’s CSF indicates participation and some debt planning, but the GRF is extremely small, indicating low provisioning for guarantee risks. Absence of ATBs suggests low short-term surplus.
27. Uttarakhand
Moderate CSF, Low GRF, No ATB
Uttarakhand has ₹5,965 crore CSF and ₹321 crore GRF, no ATBs.
Uttarakhand shows a steady reserve base with CSF stronger than many mid-sized states. GRF indicates guarantee-risk awareness. However, lack of ATBs suggests either low surplus liquidity or conservative short-term investment strategy.
29. Uttar Pradesh
Highest GRF + High ATB + Strong CSF
UP holds ₹22,769 crore CSF, ₹5,539 crore GRF, and ₹25,000 crore ATBs.
UP is a well-rounded investor with high long-term and short-term capacity. Highest GRF suggests large guarantee exposure or cautious provisioning. Massive ATB indicates large liquid balances. UP’s structure implies both fiscal scale and strategic risk preparedness.
29. West Bengal
Strong CSF and Large ATB Holding
West Bengal invests ₹15,061 crore CSF, ₹1,139 crore GRF, and ₹9,000 crore ATBs.
West Bengal maintains structured reserve strength and meaningful short-term investment balances. The state appears to manage both long-term repayment planning and treasury efficiency. GRF remains modest but sufficient for risk provisioning.
