POLICYMAKERS must be jumping with joy. At the close of the first quarter of FY25, the budget posted a consolidated surplus of Rs1.7tr — 1.4pc of GDP — after 24 years. However, their jubilation will be short-lived, since this surplus is an outcome of a one-off event: the unprecedented profits of Rs2.5tr made by the State Bank by lending money to commercial banks last year through its Open Market Operations at a record-high policy interest rate of 22pc to finance the budget. Another major factor that has helped convert the perennial deficit into surplus in the first quarter is a record government........

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