"Financial situation of the state is stable. We didn't even go for borrowings in last two months. The austerity measures are suggested to ensure that there is no unwanted spending by the departments," Parsekar told reporters on Saturday.
State Finance department had issued directions to various departments this week asking to curtail expenditures.
Departments have been asked to cut short their non-plan expenditure by 20 per cent by the end of current fiscal.
According to the order issued by Secretary Finance P Krishnamurthy, foreign tours have been banned till June 2015. It also covers tourism junkets that drew flak from all corners off late.
However, those tours which have already been approved, have been kept out of the order's ambit.
Parsekar said the circular has been issued to ensure that departments do not go for exorbitant and unwanted expenditure merely to exhaust the allocated budget.
"Just to exhaust the budget, departments start buying computers and other items and spend the money," he said.
He said the revenue collection is much better this time compared to the last year.
"We have collected Rs 212 crore in December against Rs 190 crore last year in the same month," Parsekar said.
Meanwhile, the Chief Minister hinted that the state government might increase electricity tariff for industrial consumers from ensuing financial year but no hike would be done for domestic consumers.