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  • Uttar Pradesh Budget Analysis 2025-26

Uttar Pradesh Budget Analysis 2025-26

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The Finance Minister of Uttar Pradesh, Mr. Suresh Khanna, presented the Budget for the state for the financial year 2025-26 on February 20, 2025.

Budget Highlights

  • The Gross State Domestic Product (GSDP) of Uttar Pradesh for 2025-26 (at current prices) is projected to be Rs 30.8 lakh crore, amounting to growth of 12% over 2024-25.

  • Expenditure (excluding debt repayment) in 2025-26 is estimated to be Rs 7,57,333 crore, an increase of 17% from the revised estimates of 2024-25.  In addition, debt of Rs 51,403 crore will be repaid by the state.

  • Receipts (excluding borrowings) for 2025-26 are estimated to be Rs 6,65,933 crore, an increase of 21% as compared to the revised estimate of 2024-25.  

  • Revenue surplus in 2025-26 is estimated to be 2.6% of GSDP (Rs 79,516 crore), as compared to a revenue surplus of 2.1% of GSDP (Rs 59,008 crore) at the revised estimate stage in 2024-25.  

  • Fiscal deficit for 2025-26 is targeted at 3% of GSDP (Rs 91,400 crore).   In 2024-25, as per the revised estimates, fiscal deficit is expected to be 3.4% of GSDP.

Policy Highlights

  • Roads: Four new expressways will be constructed at the cost of Rs 1,050 crore.  These include: (i) Agra-Lucknow expressway, (ii) Ganga expressway, (iii) Vindhya express way, and (iv) Bundelkhand-Riwa express way.  To improve connectivity, new village roads will be constructed and existing roads will be repaired under the Mukhya Mantri Gram Yojana.   Rs 200 crore has been allocated for this. 

  • Defence corridor:  A defence industrial corridor will be setup along the Bundelkhand-Riwa expressway at a cost of Rs 461 crore.  This is estimated to attract investments worth Rs 9,500 crore. 

  • Data Centre:  Existing data centre policy of the state envisages setting up three data centre parks.  This target will be revised to set up eight data centre parks across the state with a capacity of 900 MW.   

  • Solar Energy: A 500 MW solar power project will be set up in Jalaun in collaboration with Coal India Limited.   The project is estimated to cost Rs 2,500 crores.  A 200 MW solar project will also be set up in Jhansi.   

  • Residential schools:  Enrolment capacity of Atal Residential Schools will be increased from 360 to 1,000.  These schools provide free education to children of construction workers.   

Uttar Pradesh’s Economy

  • GSDP: In 2023-24, Uttar Pradesh’s GSDP (at constant prices) is estimated to grow by 7.5% over the previous year.  In comparison, India’s GDP is estimated to grow by 9.2% in 2023-24. 

  • Sectors: In 2023-24, manufacturing sector is estimated to grow by 13% (at constant prices), followed by agriculture (7.3%), and services (4.9%).     In 2023-24, agriculture and manufacturing are estimated to contribute 27% each to the state’s economy (at current prices) while the services sectors is estimated to contribute 46%.

  • Per capita GSDP: In 2023-24, Uttar Pradesh’s per capita GSDP (at current prices) is estimated to be Rs 1,07,468, an increase of 10.4% over 2022-23. India’s per capita GDP in 2023-24 is estimated to be Rs 2,15,935, an increase of 11% over the previous year.

Figure 1: Growth in Uttar Pradesh’s GSDP at constant prices (2011-12) 
 image 

Note: These numbers are as per constant prices (2011-12) which implies that the growth rate is adjusted for inflation.
Sources: MoSPI; PRS.

Budget Estimates for 2025-26

  • Total expenditure (excluding debt repayment) in 2025-26 is targeted at Rs 7,57,333 crore.  This is an increase of 17% from the revised estimate of 2024-25.  This expenditure is proposed to be met through receipts (excluding borrowings) of Rs 6,65,933 crore and net borrowings of Rs 61,906 crore.  Total receipts for 2025-26 (other than borrowings) are expected to register an increase of 21% over the revised estimate of 2024-25.

  • The state estimates a revenue surplus of 2.6% of GSDP (Rs 79,516 crore) in 2025-26, as compared to a revenue surplus of 2.1% of GSDP (Rs 59,008 crore) at the revised estimate stage of 2024-25.  In 2024-25, Uttar Pradesh had budgeted a revenue surplus of 3% of GSDP (Rs 74,147 crore).  

  • Fiscal deficit for 2025-26 is targeted at 3% of GSDP (Rs 91,400 crore), lower than the revised estimates for 2024-25 (3.4% of GSDP).  In 2025-26, states’ borrowing limit has been fixed at 3.5% of GSDP, of which 0.5% of GSDP will be linked to states undertaking power sector reforms.    

Table 1: Budget 2025-26 - Key figures (in Rs crore)

Items

2023-24 Actuals

2024-25 Budgeted

2024-25 Revised

% change from BE 24-25 to RE 24-25

2025-26 Budgeted

% change from RE 24-25 to BE 25-26

Total Expenditure

5,69,747

7,36,438

6,75,587

-8%

8,08,736

20%

(-) Repayment of debt

21,389

39,806

29,877

-25%

51,403

72%

Net Expenditure (E)

5,48,358

6,96,632

6,45,710

-7%

7,57,333

17%

Total Receipts

5,88,290

7,21,334

6,52,138

-10%

7,79,243

19%

(-) Borrowings

1,20,654

1,11,233

1,01,233

-9%

1,13,310

12%

Net Receipts (R)

4,67,636

6,10,101

5,50,905

-10%

6,65,933

21%

Fiscal Deficit (E-R)

80,723

86,531

94,805

10%

91,400

-4%

as % of GSDP

3.2%

3.5%

3.4%

 

3.0%

 

Revenue Surplus

36,013

74,147

59,008

-20%

79,516

35%

as % of GSDP

1.4%

3.0%

2.1%

 

2.6%

 

Primary Deficit

33,445

32,819

41,000

25%

27,304

-33%

as % of GSDP

1.3%

1.3%

1.5%

 

0.9%

 

GSDP

25,47,861

24,99,076

27,51,397

10%

30,77,500

12%

Note: BE is Budget Estimates; RE is Revised Estimates.  Uttar Pradesh received Rs 19,215 crore as 50-year interest free loans from the Centre for capital expenditure in 2023-24.   These loans are not included in states’ borrowing limit.
Sources: Annual Financial Statement, Uttar Pradesh Budget Documents 2025-26; PRS.

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