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flag RBI warns India's state subsidies risk squeezing investments in health, education, and infrastructure.

flag The Reserve Bank of India (RBI) has warned that rising state subsidies pose a growing financial stress. flag In its report "State Finances: A Study of Budgets of 2024-25," the RBI called for better management and rationalization of these subsidies to avoid crowding out investments in key sectors like health, education, and infrastructure. flag The RBI praised states for maintaining fiscal discipline but urged them to improve expenditure efficiency and explore ways to enhance non-tax revenue.

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