NEW DELHI: The Union government has earmarked Rs 1,348.01 crore for Delhi in the Union Budget for 2026-27, Finance Minister announced on Sunday, marking an increase of about 8% from the revised estimate of Rs 1,242 crore for 2025-26.
Of the total allocation, Rs 968.01 crore has been provided under the revenue head, while Rs 380 crore has been set aside as capital expenditure.
The funds are being routed through the Ministry of Home Affairs as “Transfers to Delhi”, reflecting continued central support to the national capital’s administrative and development needs.
The largest portion of the allocation, Rs 951 crore, has been provided as central assistance to Union Territories, which includes Delhi.
This forms the core of routine financial support to the city government for operational and administrative expenditure.
A significant boost has been given to infrastructure-related projects, with Rs 380 crore allocated for externally aided projects, primarily linked to water treatment infrastructure.
The funds are meant for projects such as the Chandrawal water treatment plant, aimed at strengthening Delhi’s water supply system.
The Centre has also retained Rs 15 crore for Delhi under the Union Territory Disaster Response Fund, ensuring financial preparedness for emergencies such as floods, heatwaves and other climate-related challenges.
In addition, Rs 2 crore has been earmarked towards enhanced compensation for victims of the 1984 anti Sikh riots, indicating the continuation of compensation-related commitments.
Compared to the revised estimates of the current financial year, the capital component has risen sharply from Rs 274.99 crore to Rs 380 crore, signalling a renewed focus on asset creation and long term infrastructure in the city.
However, the overall increase remains modest in comparison with Delhi’s expanding urban and civic needs, including transport, housing and water management.
With the Centre remaining the primary conduit for Delhi’s funds, the allocation is expected to once again trigger political debate between the Union government and the Delhi administration over fiscal autonomy and the adequacy of support.
The new allocation will come into effect from April 1, 2026, subject to parliamentary approval of the Finance Bill.
In 2024-25, Delhi received a total allocation of Rs 1,108 crore, with Rs 966 crore under revenue expenditure and Rs 142 crore as capital expenditure, primarily for central assistance and development projects.