Karnataka Chief Minister and Congress leader Siddaramaiah will present his 16th state budget -- ninth as the CM, in the first week of March.
While the budget is expected to cross Rs 4 lakh crore, a significant increase from the Rs 3.71 lakh crore budget of 2024-25, it could once again be a revenue deficit budget. All his previous 14 budgets have been revenue surplus, but, for the first time, the budget for 2024-25 was Rs 27,354-crore revenue deficit. This time too, the chief minister might table a revenue-deficit budget to get revenue deficit grants from the Centre.
Last August, when the 16th Finance Commission chairman Dr Arvind Panagariya visited the state, Siddaramaiah sought higher grants after highlighting that Karnataka got only Rs 45,000 crore in the form of devolution and Rs 15,000 crore grant-in-aid despite its contribution of Rs 4 lakh crore to the Gross Tax Revenue of the Union.
The big challenge is however to balance the populist schemes and economic growth.
During his first stint as the chief minister (2013-18), Siddaramaiah had a bouquet of welfare schemes- from Anna Bhagya – free 30 kg rice per month for BPL families, Ksheera Bhagya – free milk to school children, Shaadi Bhagya – Rs 50,000 financial assistance for marriage of minority community women, Indira Canteens – subsidized meals for urban poor, Krishi Bhagya – financial aid for rainwater harvesting in agriculture, Pashu Bhagya – subsidies for animal husbandry, dairy, and fisheries, Manaswini – financial aid for unmarried women above 40 years, Mythri – monthly pension for transgender individuals, Anila Bhagya – free LPG connections for BPL families, Bhoochetana Plus – scheme to improve soil fertility and productivity, free laptops for SC/ST students in higher education and Arogya Karnataka –universal healthcare scheme for all state residents.
Siddaramaiah began his second innings as the CM in May 2023, by launching the five guarantee schemes - key election promises of the Congress party, a model being replicated in other Congress-ruled states.
The Siddaramaiah government has allocated ₹52,000 crore for its flagship programmes (poll guarantees) - Gruha Jyothi (free electricity up to 200 units per household), Gruha Lakshmi (Rs 2,000 monthly financial assistance to women heads of families), Shakti (free bus travel for women), Anna Bhagya (free 10 kg food grains per BPL family member), and Yuva Nidhi (unemployment benefits of Rs 3,000 per month for unemployed graduates and Rs 1,500 for unemployed diploma holders) and is walking the tight rope as legislators cutting across party lines have been flagging the dearth of funds for development.
While critics claim that Siddaramaiah has chosen populism over development, increased debt burden by heavy spending on guarantees, and burdened the businesses with higher taxes, besides delay in execution of development projects, the chief minister has defended the guarantee schemes as social welfare commitments of his government and assured that they would continue as long as the Congress party is in power.
Siddaramaiah who is holding department-wise pre-budget meetings, picked Ritesh Kumar Singh, a Harvard University alumnus and former senior advisor to ED, World Bank, as the finance secretary, ahead of the crucial budget.
With criticisms of lopsided spending on welfare, the government is expected to increase capital expenditure on roads, irrigation, and urban development.
Leader of the opposition R Ashok predicted that the borrowings might exceed Rs one lakh crore this budget too. He also demanded to know why the government had spent only Rs 1.79 lakh crore out of Rs 3.22 lakh crore (55% of the 2024-25 budget) as of January 2025.
