CHANDIGARH: With less than a year left for the Assembly elections in the state, the Aam Aadmi Party (AAP)-led government in Punjab on Sunday presented the budget for 2026–27 with an allocation of Rs 2,60,437 crore.
The government announced the much-awaited scheme, 'Mukh Mantri Mawan Dhian Satikar Yojana' (Chief Minister's Respect for Mother and Daughters Scheme), with an outlay of Rs 9,300 crore, thus fulfilling its promise of a monthly cash transfer to women of the state.
The Budget was presented by Finance Minister Harpal Singh Cheema on Sunday, making it a first in the history of the state.
Cheema proposed a total budget expenditure of Rs 2,60,437 crore, which apparently aims to balance aggressive welfare spending with fiscal discipline in the run-up to the 2027 Assembly elections.
Rs 18,304 crore has been proposed for the social welfare and justice department --the highest-ever allocation for the department-- and includes Rs 360 crore for the Ashirwad Scheme and Rs 261 crore for post-matric scholarships.
The proposed power subsidy has been scaled down to Rs 15,550 crore, compared to Rs 20,500 crore in the 2025–26 budget estimates, following a recent Punjab State Electricity Regulatory Commission order.
'Mukh Mantri Mawan Dhian Satikar Yojana'
The 'Mukh Mantri Mawan Dhian Satikar Yojana' has been announced four years after the AAP government was sworn into power, even as it was a key poll promise made by the party ahead of the 2022 Punjab Assembly elections.
Under the scheme, the government will transfer money directly to women's bank accounts. Women belonging to general and other categories will receive Rs 1,000 per month, while those belonging to Scheduled Castes would be given Rs 1,500. However, income tax payees, present and former permanent government employees, sitting or former MPs and MLAs will not be eligible.
Tabling the budget in the Assembly, Cheema stated every promise made to the people of Punjab has been fulfilled.
"This will be the biggest cash transfer scheme, and registration to avail the benefits will start in April," he said.
"Every woman in Punjab above 18 years of age will be eligible to enrol under this scheme, barring only a few categories — present and former permanent government employees, sitting and former MPs and MLAs, and income tax payees. Even women enrolled under existing social security pension schemes such as old-age pension, widow pension, destitute women pension or disability pension will also be eligible under this scheme," the minister said.
Cheema claimed the new initiative would be the world's first universal cash transfer scheme for women.
"In all, around 97 per cent of all adult women in Punjab will be eligible under this scheme, which is the highest for any state in India," he said.
He said the initiative sought to promote "women's economic independence, strengthen their role in decision making, improve health and nutritional outcomes and encourage continued education and higher aspirations among girls."
"It affirms the government’s belief that empowerment must reflect in tangible financial security and greater dignity for women across Punjab," Cheema said.
Taking a dig at political rivals, Cheema said many states have started the "jumla" of announcing similar schemes but limit them to a small section of women, ignoring the vast majority who are financially dependent on men for their basic needs.
"For example, one of our neighbouring states announced a similar scheme but limited it only to households with annual income under Rs 1 lakh, covering only 20 per cent of all adult women," he said.
Cheema announced a budgetary outlay of Rs 9,300 crore for the 2026–27 period to ensure timely implementation of the scheme.
'Growth momentum'
The total revenue receipts for Punjab in 2026–27 are projected at Rs 1,26,190 crore. Of this, Rs 70,851 crore will come from the state’s own tax revenue and Rs 15,687 crore from non-tax revenue. Since the state’s share in horizontal devolution has been increased, the share in central taxes will be Rs 30,464 crore, up by Rs 5,293 crore over 2025–26.
The fiscal deficit is estimated at 4.08 per cent of the GSDP, with the effective revenue deficit pegged at 2.06 per cent. The outstanding debt is projected to reach Rs 4,47,754.78 crore by March 31, 2027, up from Rs 4,07,784.14 crore in the 2025–26 revised estimates.
The revenue deficit for the year is estimated at Rs 21,955.18 crore, while the state’s debt will rise to Rs 4,42,604.16 crore. Cheema said that for 2026–27, the Gross State Domestic Product (GSDP) is projected to reach Rs 9,80,635 crore, marking a 10 per cent growth rate.
The minister attributed the growth momentum to improved agricultural productivity and a resurgent services sector.
"These estimates reaffirm our resolve to combine responsible fiscal management with sustained support for economic growth," he said.
Infrastructure development
There is a fourfold increase in allocation to the Municipal Development Fund (MDF), which will rise to Rs 1,000 crore in 2026–27 from Rs 225 crore in 2025–26. A sum of Rs 500 crore has been earmarked for the Punjab Municipal Services Improvement Project (PMSIP) to strengthen long-term urban water security in Amritsar and Ludhiana.
Additionally, a budget provision of Rs 665 crore has been proposed across 149 Urban Local Bodies to accelerate urban infrastructure improvements in the state.
The Budget also proposes the construction of 6,000 additional village playgrounds and 5,000 indoor gyms across the state. Cheema said adventure sports camps will also be developed in the sub-mountainous region under the PPP mode.
A budgetary allocation of Rs 1,791 crore has been made for 2026–27 for these initiatives, marking an 83 per cent increase from last year.
Under the Rangla Punjab Vikas Fund, Rs 10 crore will be allocated for development works in each constituency. The total allocation for the fund has been doubled from Rs 585 crore last year to Rs 1,170 crore in 2026–27.
Agriculture
Cheema announced Rs 15,377 crore for agriculture and allied sectors, including Rs 40 crore to promote Direct Seeded Rice (DSR) to conserve groundwater, marking a six per cent increase from last year.
Additionally, Rs 15 crore has been allocated for a pilot project encouraging a shift from paddy to kharif maize in six districts — Pathankot, Gurdaspur, Bathinda, Sangrur, Jalandhar and Kapurthala — with an incentive of Rs 17,500 per hectare.
The Budget also includes Rs 600 crore in subsidy to manage crop residue and prevent stubble burning, Rs 7,715 crore in power subsidy for the agriculture sector, and a Rs 1,300 crore project to promote climate-resilient and high-value horticulture crops across Punjab.
Healthcare, education
In a major healthcare push, Rs 2,000 crore has been allotted for the Mukh Mantri Sehat Yojna, which provides Rs 10 lakh annual health cover per family. Another Rs 1,220 crore has been earmarked specifically for the medical education and research sector.
Meanwhile, the education sector has been given a budget outlay of Rs 19,279 crore, marking an increase of seven per cent over last year.
The government has also proposed the establishment of a new Armed Forces Preparatory Institute, named the Sant Attar Singh Maharaj Armed Forces Preparatory Institute for Boys, along with a degree college at Cheema in Sangrur.
Additionally, a comprehensive Drug and Socio-Economic Survey has been proposed in the Budget, which will commence in April this year.