HYDERABAD: In the face of subdued economic trends in the last fiscal, Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka tried to strike a perfect balance between welfare and development while presenting a ‘pragmatic’ Budget for 2025-26 with an outlay of Rs 3.04 lakh crore. This is the first time that the Telangana Budget crossed the Rs 3 lakh crore mark. The government is hoping that economic activity will pick up this year.
Of the total expenditure of Rs 3,04,965 crore proposed for 2025-26, the estimated revenue expenditure is Rs 2,26,982 crore and capital expenditure is Rs 36,504 crore.
Though Vikramarka presented his first Budget for 2024-25 with an outlay of Rs 2,91,059 crore, it was revised as Rs 2,65,934.51 crore, with the outlay being downsized by close to 9%. The finance minister proposed a 15% incremental increase of the 2025-26 Budget outlay over the revised estimates of 2024-25.
Vikramarka estimated a revenue surplus of Rs 2,738.33 crore for 2025-26 and a fiscal deficit of Rs 54,009.74 crore.
Ambitious outlook
Though Vikramarka described the Budget as “realistic,” dependence on Central grants and non-tax revenues, as in previous years, makes it a bit ambitious.
Sources told TNIE that the state government is expecting financial support from the Centre this year in the form of release of Rs 1,500 crore due to the Civil Supplies department. The sources also pointed out that the government decided to implement several Centrally-sponsored schemes and was expecting a more consistent flow of funds from the Centre.
Officials said that due to the Lok Sabha and Assembly elections, economic activity had slowed down in the first year of the Congress government. The launch of new schemes also led to financial stress, they said, expressing optimism that economic activity will pick up in the next fiscal.
Promises to keep
In keeping with his government’s commitment, Vikramarka proposed Rs 56,084 crore for the six guarantees and another Rs 48,000 crore for various other welfare schemes. In all, the government allocated a staggering Rs 1,04,329 crore for welfare schemes, close to half of the total estimated revenue expenditure of Rs 2,26,982.29 crore.
This huge chunk of revenue expenditure will be possible only with borrowings and ways and means advances.
The Budget proposed to raise loans to the tune of Rs 64,539 crore, which will take the total outstanding public debt to Rs 5,04,814 crore or 28.1% of the Gross State Domestic Product (GSDP) by the end of next fiscal.
Giving priority to BC, SC and ST welfare, the deputy chief minister proposed an allocation of Rs 40,232 crore for Scheduled Castes welfare,Rs 17,169 crore for Scheduled Tribes welfare and Rs 11,405 crore for Backward Classes welfare.
Vikramarka said that to achieve widespread industrial growth across Telangana by 2050, the government has introduced the Mega Master Plan-2050.
Yuva Vikasam gets Rs 6,000 crore
The core objective of this policy is to decentralise industrial development, ensuring that Hyderabad is not the sole hub of industrial progress, but that all regions of the state experience balanced and sustainable growth. He said that the government was establishing sector-specific industrial clusters across Telangana.
The finance minister also allocated Rs 6,000 crore in the Budget for the newly launched Rajiv Yuva Vikasam, a youth self-employment scheme. For the state government’s ambitious Future City, which will be spread over 765 sq. km across 56 villages between the Srisailam and Nagarjunasagar highways, the government allocated Rs 100 crore.
In his Budget speech, Vikramarka said that in addition to Hyderabad, the government was actively developing tier-two cities such as Warangal, Nizamabad and Khammam. “Warangal is being established as a hub for education, healthcare and IT, while Nizamabad and Khammam are being transformed into key centres for agriculture-based industries and manufacturing,” the finance minister said.
“The plans presented in this Budget are not merely financial allocations but serve as roadmaps for equitable development, economic stability and social justice,” the deputy chief minister said in his Budget speech.
