Telangana budget: Congress government faces challenges to fulfill promises
Given the State's poor revenue flow and rising debt, it remains to be seen how much of this vision can be realistically funded
Hyderabad: As Telangana gears up for the 2025-26 State Budget, all eyes are on the Congress government’s ability to translate its vision into concrete fiscal commitments. Governor Jishnu Dev Varma’s address set the stage for a budget that promises sweeping reforms in infrastructure, industrial growth, and social justice. However, given the State’s poor revenue flow and rising debt, the real challenge remains how much of this vision can be realistically funded.
On March 19, Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka is scheduled to present the State budget for 2025-26. Sources in the Finance Department indicated that it would be the largest-ever budget with an estimated outlay of more than Rs 3.15 lakh crore-Rs 3.2 lakh crore.
This marks a significant increase from last year’s Rs 2.91 lakh crore. The overall budget expenditure is expected to be restricted at around Rs 2.2 lakh crore-Rs 2.3 lakh crore at the end of the current fiscal, leaving a huge gap in the budget estimates compared to the latest fiscal condition.
The budget is expected to focus on long-pending welfare schemes that Congress had promised but failed to implement in its first year. While free bus travel for women and partial rollouts of Rythu Bharosa, crop loan waivers, LPG subsidies, and free power (up to 200 units) happened, key promises remain untouched.
Indiramma housing, sarees to Self Help Group women, and new ration cards are likely to receive fresh allocations. Yuva Vikasam, integrated residential schools, electricity, and Panchayat Raj too are likely to get significant allocations in the budget.
A significant portion of funds could go toward flagship welfare schemes like the Rs1 lakh crore Indira Mahila Shakti Mission. While these initiatives aim to boost social equity, the State is already struggling to meet salary payments for ASHA and Anganwadi workers, raising concerns over financial sustainability.
Constraints
However, financial constraints could restrict new agricultural and irrigation initiatives. Notably, the Congress government is unlikely to complete ongoing irrigation projects initiated by the previous BRS regime, avoiding giving credit to its predecessor.
The budget will allocate substantial funds for Hyderabad Metro Rail expansion, the Musi River rejuvenation project, Regional Ring Road along with rail connectivity, and Future City development. Tourism projects under the public-private partnership (PPP) model are also in the pipeline, but experts stress the need for clear timelines and private-sector incentives.
Sources indicate that the Congress government is banking heavily on Central assistance for its major infrastructure projects and the budget allocations are being made accordingly, especially for infrastructure development.
Central grants
However, in the past five to six years, Central grants have not exceeded 25 per cent of the State’s budget estimates, making this dependence a risky bet. More clarity is expected in the budget presentation on whether the government plans to enhance taxation.
While these projects are critical for long-term development, the State’s financial health raises concerns over execution. Telangana continues to grapple with mounting revenue deficits and sluggish tax collections, making its budget a high-stakes gamble.
