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Madhya Pradesh's 2026-27 Budget boosts welfare, infra with an outlay of ₹4.38 lakh crore, focusing on farmers, women, and youth while maintaining fiscal discipline.

Bhopal, February 18. The Madhya Pradesh government on Wednesday presented its Budget for the fiscal year 2026–27, with a total outlay of ₹4,38,317 crore — about 4 per cent higher than last year’s ₹4.21 lakh crore- signalling a calibrated push towards farmer welfare, women empowerment, youth employment and infrastructure expansion while adhering to fiscal discipline.

Presenting the 2nd full Budget of the Mohan Yadav-led government, Deputy Chief Minister and Finance Minister Jagdish Devda described it as a development-oriented blueprint balancing social commitments with capital investment. Chief Minister Mohan Yadav termed it a Budget dedicated to “farmers, women and youth.”A significant ₹1,33,200 crore has been earmarked for capital expenditure, reinforcing the state’s infrastructure-led growth model. Revenue expenditure stands at ₹3,45,000 crore.

Fiscal Discipline Maintained

The revenue deficit has been pegged at 0.9 per cent, while the fiscal deficit is estimated at 3.2 per cent of GSDP, remaining within the FRBM framework. Officials said the government remains committed to maintaining macroeconomic stability while accelerating growth through targeted capital investments.

The Budget comes at a time when Madhya Pradesh’s economic indicators show steady improvement. The state’s Gross State Domestic Product (GSDP) has crossed ₹15 lakh crore, while the per capita income has risen to ₹1,69,050, reflecting gradual improvement in individual income levels and consumption capacity. Although the figure remains below the national average, the upward trajectory signals expanding economic activity across agriculture, manufacturing and services, strengthening the state’s contribution to the national economy.

In a key welfare move, the government increased assistance under the LadliBehna scheme from ₹1,500 to ₹2,000 per month, effective April 1, 2026 (Total Rs 23882 crore) . The free bus travel facility for women has been extended to all government-run buses. Additionally, 33 per cent reservation in recruitment of female police personnel was announced.Farmers Get Higher Bonus, Irrigation BoostFarmer welfare received substantial allocations:Wheat bonus increased from ₹15 to ₹50 per quintal, taking total MSP plus bonus to ₹2,635. ₹20 per quintal hike announced for rice bonus. Higher interest subsidy on Kisan Credit Cards.₹15,000 crore provision for irrigation projects.The government also allocated ₹2,000 crore for cow shelters and cow dung procurement schemes.

The Budget continues a strong focus on connectivity and industrial development.₹21,630 crore has been allocated under the Chief Minister Majra-Tola Road Scheme to connect 20,600 remote habitations through nearly 30,900 km of all-weather roads in two phases.₹17,350 crore has been earmarked for development projects including metro rail expansion in Bhopal, Indore and Jabalpur, while a long-term infrastructure roadmap of ₹1 lakh crore has been outlined.A 660 MW power unit will be set up at the Amarkantak Thermal Power Plant with an investment of ₹23,000 crore.

Five new IT parks will be developed with an investment of ₹2,300 crore, alongside a telecom manufacturing zone in Gwalior and a new industrial hub in Sagar.The state has also launched India’s first Social Impact Bond on the NSE, signalling innovative financing measures.

Health, Education & Social Sector Push

•₹23,747 crore allocated for health.

•₹12,690 crore for road development.

•₹21,562 crore for urban development.

•₹40,062 crore for panchayat and rural development.

•₹5,000 crore for new medical and nursing colleges.

•Ayushman coverage enhanced to ₹10 lakh.

•Fee discounts of 20–30 per cent in government schools and colleges.

•Free laptop scheme expanded to all meritorious Class 12 students.

•₹400 crore allocated for rural sanitation and construction of 2 lakh toilets.

•₹13,851 crore earmarked for Simhastha 2028 preparations.

Nearly 7.5 lakh OBC students are expected to benefit from enhanced scholarship and welfare provisions.

Green Budget & EV Incentives

The 2026–27 Budget introduces a Green Budget framework focusing on sustainable mobility and environmental conservation.974 electric buses will operate across seven cities under PM e-Bus Seva. Electric vehicles will receive 100 per cent road tax exemption for two years, and government departments will induct EVs into their fleets.Tiger reserves are set for expansion, reinforcing the state’s conservation agenda.

What Gets Costlier?

While no major new taxes were imposed, selective revisions include:

•8–12 per cent hike in excise duty on liquor.

Minor VAT revision on petrol and diesel, increasing prices by ₹0.50–₹0.80 per litre in some cities.

•0.5 per cent surcharge on certain property registrations.

•2–5 per cent rise in vehicle registration fees (excluding EVs).

Higher road tax on luxury vehicles.

 Relief for Employees & Pensioners

The government announced a 4 per cent increase in dearness allowance for state employees and ₹500 additional monthly relief for pensioners.

Manoj Meek President CREDAI Bhopal, welcomes Madhya Pradesh Budget 2026–27 for its strong emphasis on youth, women, farmers, workers and connectivity. The state’s Economic Survey pegs FY 2025–26 GSDP (current prices) at about ₹16,69,750 crore, with 11.14% nominal growth, 8.04% real growth, and per-capita income of ₹1,69,050 a strong base that now demands faster, outcome-led delivery on urban jobs and infrastructure. We note key announcements such as ₹23,882 crore for the LadliBehna scheme and the commitment of 1 lakh solar pumps, which strengthen social security and the energy transition. We also welcome the ₹21,630 crore road programme as a major enabler for logistics, market access and construction supply chains. 

Political Response

The Congress termed the Budget a “paper tiger,” alleging insufficient measures to tackle unemployment and rural job scheme funding gaps. BSP and AAP sought additional relief for farmers and women.

The Road Ahead 

With capital expenditure crossing ₹1.33 lakh crore and fiscal deficit contained at 3.2 per cent, Madhya Pradesh has signalled an investment-led growth strategy backed by welfare expansion.

The 2026–27 Budget attempts to balance inflationary pressures with direct support to women, farmers and youth, while reinforcing infrastructure and industrial development.As debate begins in the Assembly, the focus will shift to implementation — and whether the ambitious allocations translate into sustained economic expansion.