Karnataka chief minister Siddaramaiah presented his 16th budget in the state assembly on Friday. The budget for 2025-26 is Rs 4 lakh crore, up from last year’s Rs 3.71 lakh crore. The budget focused on welfare schemes, infrastructure and industrial growth with an aim to drive economic growth while ensuring social security.
The budget was introduced during the first legislative session of the year, which started on March 3 with Governor Thaawarchand Gehlot’s address to the State Legislature.
The government has increased healthcare funding to improve medical facilities in the state. Last year, the budget was Rs 12,000 crore. This year, it has been raised to Rs 14,500 crore. The focus is on better government hospitals and expanding access to free healthcare. Plans include upgrading district hospitals, expanding ambulance services, and starting new medical colleges in less developed areas. The government has also set aside Rs 1,500 crore to buy advanced medical equipment for state-run hospitals.
Infrastructure development is another priority, with Rs 50,000 crore allocated for roads, urban transport, and rural connectivity projects. The Bengaluru suburban rail project, which has faced delays, will receive Rs 8,000 crore to speed up its completion. The metro expansion in the city will get Rs 6,500 crore, with new lines planned to reduce congestion and improve public transport. Additionally, Rs 3,000 crore is assigned for developing national and state highways, and Rs 2,000 crore is for upgrading rural roads.
The industrial sector will receive a boost with Rs 10,000 crore set aside to attract investments and increase manufacturing. The government aims to strengthen Karnataka's IT and startup hub position by incentivising technology companies and new businesses. It will invest in special economic zones for electronics, pharmaceuticals, and renewable energy. Additionally, the state has promised more financial support to micro, small, and medium enterprises (MSMEs), with a Rs 3,500 crore package to improve access to credit and infrastructure.
The education sector will receive increased funding, rising from Rs 29,000 crore last year to Rs 32,000 crore in the budget. This includes Rs 5,000 crore for upgrading government schools, Rs 3,500 crore for higher education, and Rs 2,000 crore for skill development programs. The government plans to hire more teachers, modernize classrooms, and expand scholarships for underprivileged students. It also introduces digital learning initiatives to help bridge the education gap between rural and urban areas.
Agriculture is an important focus, with Rs 20,000 crore set aside to help farmers. The government has increased subsidies for seeds, fertilizers, and irrigation and dedicated Rs 5,500 crore to modernizing irrigation projects. Crop insurance schemes will receive Rs 2,000 crore to financially protect farmers during natural disasters. Additionally, Rs 3,000 crore will improve cold storage and food processing facilities to help farmers get better product prices.
A controversial topic in the budget is the pay raise for state legislators. Recently, the Business Advisory Committee, led by Siddaramaiah, approved an increase in the salaries and allowances for MLAs. This decision will likely cause significant debate as the government raises taxes and adjusts the budget to fund welfare programs. Opposition parties, including the BJP, have criticized this move, stating that public funds should be used for development projects rather than raising legislative salaries.
The budget focuses on generating revenue, with the government aiming to collect more taxes to fund its spending. The budget revenue target for the state is set at Rs 2.85 lakh crore, targeting higher collections from GST, excise duties, and property taxes. The Chief Minister said that there will be no major new taxes, but the government may change existing tax rules to increase revenue.
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