Infra likely to be focus of Telangana 2026-27 budget as Govt trying to balance welfare and development

Telangana Government is working hard to strike a balance between welfare and development along with making adequate allocations to major infrastructure projects in the budget for next financial year 2026-27.

The State Government has been struggling hard to raise finances for its flagship projects as the revenue receipts in 2025-26 are likely to fall short of budget estimates for the second consecutive year. At the same time, adequate care is being taken to make allocations for interest payments for loans obtained by the previous Government.

Interest paid in FY 2025-26

Against the ₹19,639 crore estimated for payment of interests this fiscal, the Government had already paid ₹24,085 crore till January end and is expected to remit another ₹5,000 crore in February and March taking the total to ₹30,000 crore.

It is in this background, the focus of the next budget is likely to be on infrastructure as the Government has intensified its efforts to project the city as a global destination for investments in key sectors. Chief Minister A. Revanth Reddy has directed the officials concerned to ensure maximum allocations to infrastructure and basic amenities in the next year’s budget. There are several major projects including the Chief Minister’s pet projects like Bharat Future City, expansion of Hyderabad Metro Rail, Regional Ring Road, Radial Roads and Expressways that await allocation of funds for their expeditious completion.

Major allocations

Accordingly, Irrigation, Municipal Administration, Transport and Energy departments are likely to get major allocations in the budget to be presented by Deputy Chief Minister and Finance Minister Mallu Bhatti Vikramarka on March 20. Mr. Bhatti Vikramarka has resumed reviews of allocations that should be made department wise keeping in view the priorities of the Government.

The State Government is understandably working out modalities for securing maximum funds from the Central Government’s special assistance to States for capital investment providing 50-year interest free loans to states for boosting capital expenditure and infrastructure development. Union Finance Minister Nirmala Sitharaman made a provision of around ₹1.8 lakh crore as special assistance to States for capital infrastructure in the budget for 2026-27 and the Government is hopeful that it can secure at least ₹15,000 crore from the Centre for its infrastructure projects.

This is in addition to allocations under the Central Road Fund, Smart Cities, Urban Infrastructure Fund and other schemes where the Centre will extend its support. Efforts are being made accordingly to ensure that the State’s share of matching grant for these projects is incorporated in the budget presentation itself easing the process for securing the Central assistance without any hassles.