—
**Delhi’s fiscal health crumbles.**
In a record collapse, Delhi’s fiscal deficit for 2025-26 has ballooned to ₹20,456 crore, marking a **62% surge** from the revised estimate of ₹9,864 crore set in September 2025. The data, released Tuesday evening by Delhi Finance Minister Kailash Gahlot, shows revenue falling short by **23%** against projections of ₹48,324 crore. New Delhi’s GST collections—already a juggernaut at ₹82,000 crore annually—shrunk to ₹71,000 crore this year, a **13.5% drop** attributed to e-commerce slumps and informal sector slowdowns in NCR markets like Noida and Gurgaon.
“This isn’t just a dip. It’s a tidal shift,” Gahlot told reporters at the Delhi Secretariat on Thursday. “Revenue buoyancies from MNCs like MakeMyTrip and Zomato collapsed mid-year, forcing us to realign budgets before the financial calendar ended.”
—
**Health sector bears the brunt despite crisis surge.**
Amid the deficit expansion, Delhi’s healthcare allocation for 2025-26 stands **slashed by ₹125 crore** to ₹1,234 crore, even as city hospitals confront a surge in burn and trauma cases from recent clashes in Bhajanpura and Maujpur on March 15. Hamdard Institute of Medical Sciences & Research, which treats **4,500 burn patients annually**, saw its state grant reduced from ₹85 lakh to ₹78 lakh—a cut Hamdard’s dean Dr. AK Malik called “a dangerous contraction.”
“Our supply chain costs surged 18% this quarter due to import-dependent medical disposables,” Malik said last Friday. “With funds slashed, critical burn care kits may face shortages by June.”
The cut compounds Delhi’s existing hospital bed crisis: All India Institute of Medical Sciences (AIIMS), Delhi’s flagship institution, now runs at **118% capacity**, forcing 6,000 patients to wait over 48 hours for admission in March alone.
—
**Where revenue vanished.**
Gahlot’s team traces the shortfall to four main arteries:
1. **GST**: ₹11,000 crore below target, led by declines in food services (-21%) and retail (-14%), particularly in Lajpat Nagar and Connaught Place markets.
2. **Stamp Duty**: Fell **17%** after the Delhi High Court struck down the “Dilli Dharti” scheme for illegal constructions in unauthorized colonies in January, drying up registration fees.
3. **Property Tax**: Arrears ballooned to ₹892 crore in East Delhi, where Form 4 tax notices have gone unpaid since infrastructure projects delayed assessments.
4. **Transfers**: Delhi received only ₹1.2 billion in central tax devolution by March 22, **71% below the expected ₹4.1 billion**, due to the central government’s disallowance of Delhi’s GST compensation claims.
“Delhi is playing against a rulebook rewritten in 2021,” said economic analyst Praveen Chakravarty in a March 20 podcast. “GST compensation was promised for five years. That window closed in July 2025—and we’re still paying the price.”
—
**The health domino effect.**
With Delhi’s health budget shrinking, the Delhi Aids Control Society (DACS) now faces a **₹42 lakh cut** for its antiretroviral therapy program, threatening free medication for 3,500 HIV patients at Lok Nayak Hospital. Meanwhile, civic hospitals in Shahdara reported a **32% rise in dengue hospitalizations** this March compared to 2024, straining already reduced capacities.
Dr. Rakesh Mittal, director of Delhi Health Services, confirmed Tuesday that city-run dispensaries have ordered **rationing of paracetamol and ORS packets**, citing treasury delays in releasing funds promised in November 2025.
—
**Outlook: No relief in sight.**
Delhi’s deficit stands at **5.4% of GSDP**, breaching the **3% fiscal cap** mandated by the Delhi Fiscal Responsibility and Budget Management Act, 2009. Finance Minister Gahlot has asked for a **one-time relaxation** from the Lieutenant Governor’s office, but no response has been received as of press time.
Experts warn that without either central bailouts or revenue revival, Delhi’s social sectors—particularly healthcare—will face **deepening erosion** by Q2 of 2026.
“This is not just a budget crisis. It’s a public health emergency waiting to happen,” warned AIIMS director Dr. Randeep Guleria in a closed-door meeting with Delhi MLAs last week.
—
