Karnataka’s budget for the 2025-26 fiscal year has crossed ₹4 lakh crore for the first time, marking a significant increase from last year’s ₹3.71 lakh crore. Chief Minister Siddaramaiah presented his record 16th budget, focusing on balancing social welfare schemes and infrastructure development.
Key highlights include a ₹7,000 crore annual grant for Bengaluru, ₹8,916 crore for a double-decker flyover, and substantial allocations for women, children, and agriculture. Despite opposition criticism, Siddaramaiah emphasized the budget’s role in shaping the state’s future and ensuring social equity.
Budget Highlights and Reactions
The Karnataka budget is notable for its ambitious size and comprehensive allocations aimed at both infrastructure development and social welfare. The budget has reached ₹4.09 lakh crore, with a focus on addressing key issues such as traffic congestion in Bengaluru and providing essential services to marginalized groups. Key highlights include:
- Infrastructure Development:
- An annual grant of ₹7,000 crore for Bengaluru, significantly increased from ₹3,000 crore.
- A massive allocation of ₹8,916 crore for constructing a double-decker flyover alongside Namma Metro Phase 3.
- ₹50,000 crore earmarked for roads, urban transport, and rural connectivity projects.
- Investments of ₹8,000 crore for the Bengaluru suburban rail project and ₹6,500 crore for metro expansion.
- Additional funds of ₹3,000 crore dedicated to developing national and state highways.
- Development of a 300 km network of additional roads utilizing canal buffer zones at a cost of ₹3,000 crore.
- Development of arterial and sub-arterial road networks measuring 460 km in BBMP area at a cost of ₹660 crore.
- Construction of flyovers and grade separators spanning 120 km in Bengaluru.
- Social Welfare and Guarantee Schemes:
- A total of ₹51,034 crore allocated for five guarantee schemes aimed at providing financial security to citizens.
- Significant investments of ₹94,084 crore in women-centric programs and ₹62,033 crore for initiatives focused on children.
- An allocation of ₹1,000 crore specifically designated for the Chief Minister’s Minority Colony Development Programme.
- ₹150 crore for the repair and renovation of Waqf properties and infrastructure for Muslim burial grounds.
- ₹100 crore earmarked for the comprehensive development of Jain, Buddhist, and Sikh communities.
- ₹250 crore allocated for the development of the Christian community.
- Agriculture Sector:
- The agriculture budget has been increased to ₹51,339 crore to support farmers with subsidies and modernisation efforts.
- A substantial amount of ₹20,000 crore is dedicated to helping farmers with seeds, fertilizers, and irrigation systems.
- Additional funds include ₹5,500 crore for modernising irrigation projects and ₹2,000 crore allocated for crop insurance schemes.
- Education Sector:
- The education budget has risen from ₹29,000 crore to ₹32,000 crore to enhance educational infrastructure.
- Noteworthy allocations include ₹5,000 crore for upgrading government schools and ₹3,500 crore for higher education initiatives.
- Introduction of AI-based “Kalika Deepa” Programme in collaboration with Ek-Step foundation to improve language skills in 2,000 schools.
- “Jnana Setu” Programme in collaboration with Khan Academy to innovate science and maths teaching in government schools.
- Healthcare:
- The healthcare budget has increased from ₹12,000 crore to ₹14,500 crore to improve medical facilities across the state.
- Plans include allocating ₹1,500 crore to purchase advanced medical equipment for state-run hospitals.
- Implementation of a ‘Comprehensive Health Programme’ over three years under the Brand Bengaluru Plan with an allocation of ₹413 crore.
- Industrial Development:
- A commitment of ₹10,000 crore aims to attract investments and bolster manufacturing within the state.
- Additionally, a package of ₹3,500 crore is set aside to support MSMEs in accessing credit and improving infrastructure.
- Minority Welfare Initiatives:
- Provision of formal education and facilities in madrasas to prepare students for SSLC examination through NIOS.
- Encouragement for minority youth to launch start-ups via Karnataka Minority Development Corporation.
- Construction of an additional building in Haj Bhavan, Bengaluru for Haj pilgrims and their relatives.
- 4% reservation for Muslims in public works contracts under Category-II B.
- Brand Bengaluru Initiative:
- An allocation of ₹1,800 crore will support 21 development schemes under the ‘Brand Bengaluru’ initiative.
Despite these ambitious allocations aimed at fostering growth and equity within Karnataka’s diverse population, opposition parties have raised concerns regarding fiscal management. The BJP has criticized certain provisions as “appeasement,” particularly those targeting minority communities.
Background and Context
The budget presentation comes at a time when Karnataka is facing financial challenges such as a revenue deficit and high borrowing levels. The state’s GSDP is projected to be around ₹31 lakh crore with a growth rate of 10.2%, which is higher than the national average.
The government aims to balance its social guarantees with increased capital expenditure to boost infrastructure and industrial growth.
Historically known as a hub for technology and innovation with Bengaluru as its major IT centre, Karnataka’s growth has been driven by its strong industrial base and skilled workforce. However, challenges such as traffic congestion and infrastructure bottlenecks have hindered its potential.
This budget aims to address these issues through substantial investments in infrastructure projects while also focusing on rural development initiatives.
The budget also includes provisions for increasing reservations in government contracts and procurement for SC/ST and OBC communities, enhancing honorariums for religious leaders, and developing specific community facilities like Haj Bhavan.
Additionally, there are plans to enhance educational programs through AI-based initiatives and collaborations with international platforms like Khan Academy.
