Uttar Pradesh Government Presents Historic Rs 9.12 Lakh Crore Budget for 2026-27
The Uttar Pradesh government has unveiled a landmark budget of Rs 9.12 lakh crore for the financial year 2026-27, representing a substantial 12.9% increase over the previous year's allocation. Presented by Finance Minister Suresh Khanna in the State Assembly, this budget emphasizes robust infrastructure development, employment generation, and enhanced healthcare services, aiming to propel the state's economic growth and improve citizen welfare.
Key Financial Highlights and Strategic Focus
Capital Expenditure has been strategically set at 19.5% of the total budget outlay, underscoring the government's commitment to long-term infrastructure projects. The state's Gross State Domestic Product (GSDP) is estimated at Rs 30.26 lakh crore for 2024-25, reflecting an impressive 13.4% growth rate. Per capita income is projected to rise to Rs 1.2 lakh in 2025-26, while the unemployment rate has reportedly declined to 2.24%, indicating positive economic momentum.
Major Sector-Wise Allocations and Initiatives
Health and Medical Education: A total of Rs 37,956 crore has been allocated for medical, health, and family welfare, with Rs 14,997 crore dedicated to medical education. Significant provisions include Rs 1,023 crore for establishing new medical colleges and Rs 315 crore for a Cancer Institute in Lucknow, aiming to bolster healthcare infrastructure and accessibility.
Infrastructure Development: Infrastructure receives a major boost with Rs 34,468 crore earmarked for roads and bridges, Rs 27,103 crore for infrastructure and industrial development, and Rs 5,000 crore for industrial area expansion. Additional funds include Rs 2,000 crore under the Atal Infrastructure Mission and Rs 1,500 crore for bypasses, ring roads, and flyovers, targeting improved connectivity and economic hubs.
Urban and Rural Development: Urban development is allocated Rs 26,514 crore, while rural development gets Rs 25,500 crore. The Pradhan Mantri Awas Yojana (Gramin) receives Rs 6,102 crore to support housing initiatives, addressing both urban and rural housing needs.
Agriculture and Allied Sectors: Agriculture schemes are funded with Rs 10,888 crore, including Rs 637 crore for solarisation of diesel pump sets and Rs 245 crore for an agri-export hub, promoting sustainable farming and market access.
Industry, MSMEs, and Employment: To foster industrial growth and job creation, Rs 3,822 crore is allocated for MSMEs, Rs 1,000 crore for the Chief Minister Youth Entrepreneur Development Scheme, and Rs 575 crore for Sardar Vallabhbhai Patel Employment and Industrial Zones. The handloom and textile sector receives Rs 5,041 crore to boost traditional industries.
Technology and Electronics: The IT and electronics sector is allocated Rs 2,059 crore, with Rs 225 crore for the UP AI Mission. Initiatives include establishing AI labs in ITIs and a Cyber Security Operation Centre, enhancing digital infrastructure and innovation.
Energy and Irrigation: The energy sector gets a massive Rs 65,926 crore, including Rs 2,104 crore for renewable and additional energy sources. Irrigation and flood control are funded with Rs 18,290 crore, aiming to ensure water security and agricultural productivity.
Aviation and Tourism: Civil aviation receives Rs 2,111 crore, with Rs 750 crore specifically for the Jewar Airport project. Tourist site development is allocated Rs 500 crore to promote tourism and economic diversification.
Social Welfare and Fiscal Discipline
For Panchayati Raj, a provision of Rs 32,090 crore has been proposed, marking a 67% increase over the previous year. Women and Child Development schemes receive Rs 18,620 crore, an 11% increase from 2025-26, highlighting a focus on social empowerment.
Fiscally, the budget adheres to a 3% fiscal deficit limit, aligning with recommendations of the 16th Finance Commission applicable until 2030-31. The state's debt-to-GSDP ratio, which peaked at 33.4% during the Covid-19 pandemic, has been reduced to below 27% in 2024-25 and is targeted to decline further to 23.1% in 2026-27, with a medium-term goal of bringing it below 20%.
This comprehensive budget reflects Uttar Pradesh's strategic vision to drive economic growth through targeted investments in critical sectors, while maintaining fiscal prudence and enhancing the quality of life for its residents.
