Odisha’s Treasury Bill Holdings Triple in a Quarter, Now Second-Highest Among States
RBI data show a sharp rise to ₹12,236 crore in June as Odisha parks temporary surpluses in low-risk, high-liquidity T-Bills.
Bhubaneswar : Odisha has sharply increased its investments in Treasury bills (T-Bills) during the April–June quarter, moving to the second-highest position among states by June, according to Reserve Bank of India (RBI) data shared in recent reports. The state’s exposure has risen threefold in just two months—from ₹4,285 crore in April to ₹8,258 crore in May, and further to ₹12,236 crore in June.
Karnataka leads the pack, with T-Bill holdings at ₹50,177 crore in April, ₹70,642 crore in May and ₹70,654 crore in June. Arunachal Pradesh has also stepped up its placements, increasing from ₹1,800 crore in April to ₹2,300 crore in May and ₹3,400 crore in June.
Experts say the pattern reflects how states manage seasonal cash flows. States often receive sizable inflows from tax devolution and central transfers at discrete intervals, while actual spending on salaries, subsidies and capital works unfolds gradually through the year. The timing gap between inflows and outflows creates temporary cash surpluses, which treasuries prefer to park in short-duration, low-risk instruments such as T-Bills that can be redeemed quickly when spending needs arise.
“States’ rising exposure to T-Bills reflects seasonal cash flow patterns. With expenditure commitments often staggered through the fiscal year, they tend to deploy idle funds into short-duration instruments like T-Bills, offering both security and quick access to cash. It also indicates a more conservative treasury strategy focused on capital protection,” Moneycontrol reported, quoting Venkatakrishnan Srinivasan, Founder and Managing Partner at Rockfort Fincap LLP.
For Odisha, the move signals an emphasis on safety and liquidity at a time when the state is also ramping up capital spending commitments. By using T-Bills, which are backed by the Centre and trade in deep, liquid markets, the treasury can earn a market-linked return while preserving principal and keeping funds readily available for near-term outlays. The strategy reduces the opportunity cost of idle cash without locking the state into longer-dated instruments that could constrain flexibility.
The quarter’s month-wise progression also hints at how Odisha’s receipts and spending cadence evolved early in the fiscal year. As devolution and transfer inflows accumulated, the treasury increased its T-Bill positions, with the June stock three times the April level. Whether this pace sustains will depend on how quickly project execution, payments and scheme-related spending accelerate in the second half of the year, when states typically front-load more capital expenditure.
Analysts add that stronger cash management practices across states have made T-Bills a preferred parking avenue relative to traditional bank balances, thanks to same-day liquidity, minimal credit risk and transparent pricing through regular RBI auctions. For investors and rating agencies, larger—but well-managed—T-Bill books can signal prudent treasury operations rather than fiscal stress, provided they unwind as expenditures pick up.
With Karnataka maintaining the highest T-Bill corpus and smaller states like Arunachal Pradesh also scaling up, Odisha’s trajectory aligns with a broader national trend of states fine-tuning cash management. The key metric to watch in the coming months will be how these balances adjust as capital projects move from tendering to execution and as states close out quarterly payment cycles.
For now, Odisha’s rise to ₹12,236 crore in June underscores a conservative, liquidity-first approach—earning returns on idle cash while keeping the state ready to fund priority programmes at short notice.
