Hyderabad: With an eye on the rural vote base and ahead of the Greater Hyderabad Municipal Corporation (GHMC) elections later this year, the Telangana state government’s Rs 3.24 lakh crore budget for 2026-27 has big allocations for its six guarantees and infrastructure announcements.
From healthcare and education to panchayat raj and rural development and power, significant allocations were made towards welfare and essential services sectors.
Irrigation, agriculture, energy, and education—all four sectors received upwards of Rs 20,000 crore in the budget. Farmers’ welfare has been allotted Rs 23,179 crore, including the Rythu Bharosa funds. Other gainers for FY27 are the Municipal Administration and Urban Development (MA&UD) department and the healthcare sector which received Rs 17,907 crore and Rs 13,679 crore respectively.
With new transformers, substations and an expansion of network capacity planned, the power sector has been earmarked Rs 21,285 crore.
“Further, the per capita power consumption stands at 2,508 units, which is much higher than the national average. This is an indicator that clearly reflects the pace of Telangana’s development. Our goal is clear: Power to every home, assurance to every farmer, energy to every industry, and quality service to every citizen. Supplying electricity is our responsibility,” the finance minister Bhatti Vikramarka said in his third consecutive budget presentation Friday.
Keeping in mind its votebank, the Congress allocated substantial sums to the social welfare segment. Rs 999 crore has been earmarked for labour welfare, Rs 3,143 crore for women and child welfare, Rs 11,784 crore for Scheduled Castes’ welfare, Rs 7,937 crore for Scheduled Tribes’ welfare, Rs 12,511 crore for Backward Classes’ welfare, and Rs 3,769 crore for minority welfare, according to data in the budget document.
Novelty factor
A Rs 1,000 crore allocation to TOMCOM (Telangana Overseas Manpower Company), health profiling of all citizens in the state, and accident insurance to government employees, pensioners, and their dependents lent a novelty to the budget.
Opening up employment opportunities for youth overseas under the TOMCOM scheme, the government said it would use the funds to impart language, technical, and soft skills training for youth in the state in four key sectors viz., construction, healthcare, logistics, and hospitality.
It would work closely with the central government to ensure immigration processes and visa services are smoothly implemented. In its manifesto, the Congress promised to create 2 lakh jobs within 100 days of coming to power in December 2023. The Revanth Reddy government has so far only filled some 60,000 plus vacancies.
Chief Minister A. Revanth Reddy’s fingerprints on the budget were hard to miss, with the government prioritising the implementation of the CM’s flagship programmes.
The Musi Riverfront development, two additional phases of the Hyderabad metro rail project, the regional ring road project and expeditious allocation of sums for rolling out the six guarantees featured prominently in the budget.
The three projects, which are still in the detailed project report (DPR) stage, would be funded through off-budget borrowings, central assistance and external loans, the finance minister said.
The finance minister pegged the revenue expenditure for FY 27 at Rs 2,34,406 crore, an increase of nearly 20 per cent compared to the Rs 2.03 lakh crore of the current fiscal. Capital expenditure was budgeted at Rs 47,267 crore, given the scale of projects to be implemented in Hyderabad’s CURE (Core Urban Region Economy) and the PURE (Peri-Urban Region Economy) zones.
“This budget is not just a compendium of figures. It is a charter of resolve to fulfil the hopes and aspirations of the people of Telangana. We have designed it to reflect the comprehensive development of the state. We are governing in adherence to constitutional values and with transparency. We do not lie for applause. This government works on the foundation of facts,” Bhatti Vikramarka said on the floor of the House.
During his speech, two sets of numbers received a thumping applause from the treasury benches—Telangana’s Gross State Domestic Product (GSDP) and the state’s per capita income.
Telangana recorded a growth rate of 10.7 per cent during 2025-26 as compared to the national growth rate of 8 per cent and the state’s GSDP stands at Rs 17,82,198 crore. Currently, Telangana’s per capita income for FY 26 stands at Rs 4.18 lakh as against the national per capita income of Rs 2.19 lakh, the budgetary documents accessed by The Print revealed.
“Telangana’s growth rate is 2.7 per cent higher than the national average growth rate. Likewise, the state’s GSDP accounts for 5.0 per cent of the national GDP, making Telangana a strong growth engine for the country,” he said.
However, the state’s poor fiscal health gave the Opposition reason to decry the government’s achievements. With the state’s fiscal deficit at 3 per cent of the GSDP, Telangana’s public debt is projected to reach Rs 5.62 lakh crore by the end of FY 2026-27, according to the budget documents. The finance minister indicated that the government was looking to borrow an additional Rs 60,000 crore largely through open market borrowings.
A few days into the budget session that commenced on 16 March, the CM had disclosed on the assembly floor that his government has secured the Centre’s approval to restructure Rs 2 lakh crore in debt, of which Rs 27,000 crore has already been restructured this fiscal, reducing interest from 11.90 per cent to 7.25 per cent.
“Further, the repayment period was extended, and the principal repayment tenure was lengthened to between 20 and 39 years. Through this debt restructuring, the amount payable from 2025-26 to 2031-32 was reduced from Rs 34,058 crore to Rs 11,915 crore. As a result, the state’s cash outflow has reduced by Rs 22,142 crore, providing liquidity relief,” Bhatti Vikramarka explained during his presentation.
New schemes
The government announced that it would introduce a mid-day meal scheme for intermediate students from June. The mid-day meal scheme so far was restricted to students in government schools. “Today, I am announcing another very important reform: We are now extending a new midday meal scheme to students pursuing intermediate education in government junior colleges as well. This marks the beginning of a new chapter in the measures we are taking for student welfare,” the finance minister said.
In addition, a free breakfast scheme for school children is also going to be introduced. Under this scheme, school children will be given a glass of milk three days a week and ragi malt the other three days.
In the health sector, the government said it would implement a state public health profile system that is otherwise available only in developed countries. “For this, we will prepare a health profile of every person and provide them with digital health cards. Strict confidentiality will be maintained in their data management,” Bhatti Vikramarka announced.
For a large section of government employees and pensioners whose dues and raises are pending for two years, a cashless health security (Employees Health Scheme-EHS) to provide treatment for 1,998 diseases in government hospitals as well as in 421 empanelled private hospitals was also announced.
Congressmen in Telangana believe that this restructuring headroom is the single most important fiscal enabler for the budget’s ambitions. Without it, the debt service burden would consume all expansion capacity, they told ThePrint after the budget was presented.
The Bharat Rashtra Samithi MLAs who staged a walkout during the budget presentation said the budget completely exposed the “shallowness” of the government. Gangula Kamalakar, senior BRS leader and MLA from Karimnagar said, “In the days to come, it is certain that the downtrodden and weaker sections will unseat the Congress party from power. In this budget, they have merely hoodwinked all sections of society.”
BJP President Ramchander Rao also slammed the budget saying the Congress government was relying on central grants and PPP projects. “The budget is funded by Modi’s generosity. With the state government living off borrowings, the finance minister seems to have read last year’s budget. Even 2.5 years into the Congress’ rule, we do not see an improvement in people’s welfare or development in Hyderabad and rural areas,” Rao said.
(Edited by Viny Mishra)
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