Uttar Pradesh Budget 2026-27 Aims to Propel State Toward Trillion-Dollar Economy Goal
Chief Minister Yogi Adityanath asserted on Thursday that the Uttar Pradesh budget for 2026-27 will serve as a pivotal milestone in placing the state on a robust growth trajectory, marking a significant step toward its ambitious trillion-dollar economy objective. Addressing the legislative assembly during the budget discussion, Adityanath emphasized that Uttar Pradesh has transformed from being among the "bottom three" states to ranking in the "top three" over the past eight-and-a-half years.
Fiscal Transformation and Economic Indicators
The Chief Minister attributed this remarkable turnaround to the government's transparent policies and stringent financial management. He revealed that the state's Gross State Domestic Product (GSDP) has surged to Rs 26 lakh crore, with a targeted increase to Rs 40 lakh crore by 2026-27. "The change in perception about Uttar Pradesh is the direct result of consistent and transparent policy decisions," Adityanath stated.
Highlighting key fiscal improvements, Adityanath noted that the fiscal deficit has been reduced from 4.3% of GSDP in 2016-17 to 2.97% in 2025-26. Additionally, the debt-to-GSDP ratio, which stood at approximately 30% in 2016-17, has declined to about 26% in 2025-26, with a goal to further lower it to 23% by 2026-27. "The state is strictly adhering to RBI guidelines and complying with FRBM limits," he affirmed.
Infrastructure Investment and Employment Generation
Emphasizing the critical role of capital expenditure, Adityanath explained, "Revenue expenditure primarily covers salaries and pensions, whereas capital spending builds infrastructure and yields long-term economic returns." Citing expert analysis, he asserted that every rupee invested in infrastructure generates returns of 5-6 times and creates substantial employment opportunities.
Capital expenditure has escalated from around Rs 71,000 crore in 2016-17 to over Rs 1.77 lakh crore in 2025-26, positioning Uttar Pradesh as the national leader in this domain. The credit-deposit ratio has also improved, rising from 45% to 61-62%, indicating that more funds are being reinvested within the state, thereby fostering job creation for lakhs of youth.
MSME Growth and Rural Empowerment
Adityanath underscored the government's focus on Micro, Small, and Medium Enterprises (MSMEs), detailing initiatives such as the ‘One District One Product’ (ODOP) scheme. Uttar Pradesh now boasts 96 lakh MSME units, employing over three crore people. The implementation of the Vishwakarma Scheme in 2019 has further strengthened rural self-reliance by providing toolkits, training, and affordable bank loans to traditional artisans.
Contrast with Previous Administration and Future Priorities
Contrasting his government's performance with the previous Samajwadi Party regime, Adityanath recalled that Uttar Pradesh was once labeled a BIMARU state plagued by poor law and order. He highlighted the 2017 farm loan waiver, where loans up to Rs 1 lakh were waived for 86 lakh farmers using budgetary resources without external borrowing.
Reports from NITI Aayog and the Comptroller and Auditor General (CAG) have recognized Uttar Pradesh as a "frontrunner" in the Fiscal Health Index 2025, commending its strong revenue position and balanced fiscal management. The state presented its inaugural Economic Review, signaling enhanced financial transparency.
Adityanath outlined future priorities, focusing on ‘Industry 5.0’ and emerging technologies like artificial intelligence, which he described as the cornerstone of the next industrial revolution. The school dropout rate has decreased from 6-7% under the SP government to less than 3%, with plans to construct composite schools in all 8,000 nayay panchayats.
New Initiatives and Social Welfare
On Uttar Pradesh Foundation Day, January 24, the government announced the establishment of Sardar Vallabhbhai Patel Employment and Industrial Zones in every district. These zones aim to promote employment and investment through an integrated framework, with an estimated expenditure of Rs 50-100 crore per zone and approximately 100 acres of land allocated near district headquarters.
Additional measures include cashless treatment facilities for teachers, provision of toilets and potable water for girl students, and allegations that the Samajwadi Pension scheme favored SP cadre while neglecting poor Brahmin communities. Adityanath concluded by declaring Uttar Pradesh a "dream destination" for investment, transitioning from a law-and-order risk to a hub of ‘Triple T’ growth—technology, trust, and transformation.
