Budget 2025: Will Andhra Pradesh emerge as the big winner again?

The Union Budget 2025-26 will test Prime Minister Narendra Modi's ability to navigate the pulls and pressures of the alliance. (File Photo: PTI)

There are many firsts in the central government under Prime Minister Narendra Modi that returned to power for the third successive term in June 2024. It is for the first time in three Lok Sabha elections that the BJP failed to get a majority on its own. It is also the first time that PM Modi, in his 25-year-long career as an administrator, has been part of a government dependent on an alliance.

So, when the first full Budget presented by the NDA government in July last year laid special focus on Andhra Pradesh and Bihar, states ruled by parties that contribute 16 and 12 Lok Sabha seats to the alliance's tally of 293, it came as no surprise. By keeping allies happy, Modi has ensured "sabka sath" for his third successive government and also sent out a strong signal to the Opposition which was virtually claiming victory in defeat.

Andhra Pradesh's wish list for Budget

While last year's Budget was about building confidence among major alliance partners, the focus this year is expected to be about keeping them intact. A special focus on Bihar is likely considering that polls are due in the state in October-November this year. Nevertheless, Chandrababu Naidu has put forth a long list of demands to the Centre yet again.

In his meetings with PM Modi, Finance Minister Nirmala Sitharaman and other members of the Union Cabinet, Andhra Pradesh Chief Minister Chandrababu Naidu has sought special assistance for the state, claiming that the revenue deficit grants meant for a period of five years was depleted by the previous administration within three years.

In his meeting with the Prime Minister, Naidu pointed to the alleged diversion of funds meant for 94 centrally sponsored schemes by the erstwhile state government and sought financial help in the form of a special assistance. He also informed the Prime Minister about the establishment of the ArcelorMittal Steel Plant unit in Andhra Pradesh and sought central assistance for the supply of raw material besides helping to get the necessary permissions at the earliest possible.

Priority sought for river linking projects

In a meeting chaired by FM Sitharaman with states ahead of the Budget, Andhra Pradesh FM Payyavula Keshav urged the Centre to accord priority to river linking projects in the state in the Union Budget 2025-26.

The AP government plans to link Krishna, Penna and Vamsadhara to take the surplus water through a series of canals and reservoirs to the drought-prone and backward districts of Rayalaseema and South-Coastal districts, the minister told the FM and sought financial assistance from the Centre on the lines of support promised to Rajasthan's plan for linking 11 rivers and transforming it into a water-surplus region.

Keshav also urged the Centre to adopt a 90:10 funding pattern for all centrally sponsored schemes in Purvodaya states (of which AP is a part) besides providing viability gap funding for different PPP projects including the development of road infrastructure, airports, ports and metro rail projects in Vijayawada and Visakhapatnam. The state has also sought the sanction of five textile clusters for AP keeping in view the huge number of weavers in the state.

What Andhra Pradesh got in last Budget

The Union Budget 2024-25 laid special emphasis on Andhra Pradesh, allocating over Rs 50,000 crore, or 4 percent of the GDP, for the state. This included special financial assistance through multilateral development agencies, addressing the state's capital needs and funds for the early completion of the Polavaram project, a key initiative by CM Naidu.

The Budget also saw FM Sitharaman unveil a special financial support package of Rs 15,000 crore for the development of Andhra Pradesh's new greenfield capital city, Amravati, with a provision for additional amounts in future years.

Due priority was accorded to the development of infrastructure in the Kopparthy and Orvakal nodes in Visakhapatnam-Chennai and Hyderabad-Bangalore industrial corridors in line with the commitments given to the state under the AP Reorganisation Act, 2014. The Centre had also pledged support for the development of backward regions of Rayalseema and north coastal districts.

The Budget will once again put to test the BJP and the Prime Minister's ability to navigate the demands of alliance partners, especially the TDP and the JD(U). PM Modi is aware how crucial it is to keep both alliance partners in good spirits -- for the sheer numbers they command and also their tenacity to ramp an offensive.