Reserve Bank of India Governor Sanjay Malhotra said on Tuesday 27 October 2026 that the quality of expenditure matters for states' long-term fiscal health, according to Business Standard's report of an RBI press release. He was speaking at the 36th Conference of State Finance Secretaries, where the theme was the role of expenditure quality, effective cash management and prudent debt management in states' fiscal sustainability. Spectate Media has not seen the press release or the speech, and the report does not name the venue.
What he asked states to do
The Governor asked states to adopt prudent borrowing strategies and efficient cash management, to onboard the Unified Lending Interface (ULI) and to use programmable central bank digital currency (P-CBDC) for direct benefit transfers. He also urged them to use the State Level Bankers' Committee forum effectively. The report does not explain either tool. ULI is a digital platform the RBI has been developing to speed up credit delivery, and a programmable digital rupee can be restricted to a defined use, which is why it is relevant to benefit schemes.
What the conference reviewed
The agenda covered states' market borrowings, short-term financial accommodation from the RBI and states' adoption of the Benchmark Issuance Strategy. The Governor released a booklet, Compendium on Cash and Debt Management for State Governments, which sets out concepts, operating processes and good practices.
Who attended
Finance secretaries from 27 states and 3 Union Territories attended, along with senior officials of the Ministry of Finance, the Controller General of Accounts and the Comptroller and Auditor General of India.
What to watch
The report gives no figures on state borrowing, deficits or interest rates, and does not say whether any state has committed to the new tools. Whether states adopt ULI and P-CBDC for transfers is the point to track.
Source: Business Standard, 27 October 2026. This is a summary of a news report, published as general information. It is not legal, tax or investment advice.
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