UP sees biggest Budget jump in 10 years as state gears up for polls

UP budget size increases at fastest pace

• Uttar Pradesh Budget to rise 27.4 percent in FY27, fastest growth in a decade
• Revenue expenditure to rise over 31%, focus on welfare and salaries
• Law and order gets Rs 44,000 crore; more funds for women and child schemes

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Uttar Pradesh is set to witness its sharpest Budget expansion in a decade as the state prepares for elections expected next year, according to a Moneycontrol analysis of the latest state Budget numbers.

In what could be the last full Budget before the election cycle begins, the state government has significantly stepped up spending, signalling a stronger focus on welfare, public services and administrative priorities.

The state’s total expenditure is projected to rise to about Rs 9.13 lakh crore in FY27, up from roughly Rs 7.16 lakh crore in FY26, implying a 27 percent increase from the previous year.

This compares with an increase of 18.7 percent in FY26, marking the fastest pace of spending growth in at least a decade. Uttar Pradesh already has the largest Budget size among Indian states, reflecting both its population scale and expanding fiscal footprint.

A notable shift in the composition of spending is visible this year. The increase is being driven largely by revenue expenditure, which is expected to grow by over 31 percent in FY27, while capital expenditure growth is projected at about 11 percent. This marks a reversal of the earlier trend when capital spending growth had outpaced revenue spending until around FY25. The change suggests a greater emphasis on welfare programmes, subsidies, salaries, pensions and administrative spending rather than infrastructure creation.

Sector-specific allocations underline this shift. In women and child development, the government has earmarked Rs 18,620 crore, an 11 percent increase over the previous year. Financial support under schemes such as assistance for daughters’ marriages has been doubled from Rs 50,000 to Rs 1 lakh. Meanwhile, allocations for the Nirashrit Mahila Pension Yojana have reached around Rs 3,500 crore, with beneficiary numbers doubling over the past decade.

Law and order has also emerged as a major focus area ahead of the elections. Around Rs 44,000 crore has been allocated for policing, security infrastructure and modernisation of the police force. This aligns with the government’s broader political messaging around governance, security and administrative efficiency.

Despite the strong overall expansion, capital outlay as a share of total spending is expected to decline slightly to around 19.5 percent in FY27, down from over 22 percent in FY26. This indicates that while infrastructure spending continues, welfare and operational expenditure are taking precedence in the pre-election year.