₹9.13 Lakh Crore UP Budget 2026–27: Big Bets on Education, Jobs, Agriculture & Infrastructure to Reshape Growth Trajectory

By Tajdar H. Zaidi

Lucknow: The Uttar Pradesh government has unveiled a massive ₹9,12,696.35 crore Budget for FY 2026–27, marking a 12.2% increase over the previous fiscal year.

Presenting the Budget in the Assembly, Finance Minister Suresh Khanna underscored that the blueprint aims to accelerate long-term growth by prioritising education, agriculture, infrastructure expansion, industrial development, and job creation—while maintaining fiscal discipline.

This is among the largest state budgets in India and signals UP’s ambition to consolidate its position as one of the country’s fastest-growing regional economies.

Fiscal Discipline With Growth Orientation

The government reiterated its commitment to responsible fiscal management.

• Fiscal Deficit: To remain capped at 3% in line with the 16th Finance Commission recommendations, a ceiling expected to continue until 2030–31.
• Capital Expenditure: Nearly 19.5% of total outlay allocated to capital spending, reflecting a strong push toward infrastructure and asset creation rather than revenue expenditure.

Higher capital expenditure typically drives multiplier effects—boosting construction, manufacturing, logistics, and employment across sectors.

Sectoral Allocations: Education, Health & Agriculture Lead

The Budget emphasises human capital and rural prosperity as engines of growth:

• Education – 12.4% of total outlay
• Health – 6%
• Agriculture & Allied Sectors – 9%

Education Reforms

The state plans to expand schools, modernise higher education institutions, and strengthen digital learning infrastructure.

Additional hostels for female students aim to improve female enrollment and retention. Skill-based curricula aligned with industry demand are expected to be integrated into technical institutions.

Health Infrastructure

The proposal includes trauma centres in district hospitals, upgrades to primary health centres, and better emergency response systems.

The state welcomed the Centre’s decision to reduce prices of medicines for diabetes and cancer, saying it would reduce the burden on vulnerable families.

Employment & Skill Development: Mission Mode Implementation

Addressing unemployment remains central to the Budget’s strategy.

• Expansion of existing skill development centres
• Establishment of new training and placement hubs
• Private sector participation under the PPP model
• Special training centres dedicated to women’s workforce participation

The government is likely to align training modules with industrial corridors, MSMEs, and emerging sectors such as electronics, renewable energy, logistics, and tourism.

If implemented effectively, this could reduce the skills gap and improve job-readiness among youth.

Agriculture & Rural Income Enhancement

To boost farm incomes, the government announced the creation of an agri-export hub under the World Bank-supported UP-AGREES project.

This initiative is expected to:

• Improve farm-to-market linkages
• Enhance food processing and cold chain infrastructure
• Promote high-value crops and exports
• Encourage Farmer-Producer Organisations (FPOs)

Support for allied sectors such as dairy, fisheries, and horticulture is also likely to strengthen rural economic diversification.

Ease of Doing Business & Industrial Reforms

The state plans to streamline licensing and registration under the Jan Vishwas reform framework, reducing the compliance burden on businesses.

Key focus areas include:

• MSME support
• Faster industrial clearances
• Investor-friendly policies
• Strengthening logistics and warehousing

These reforms aim to improve UP’s ranking in ease-of-doing-business metrics and attract domestic as well as foreign investment.

Digital Economy & Startup Ecosystem

A Digital Entrepreneurship Scheme will be launched to support startups and tech-driven enterprises. The scheme is expected to offer:

• Financial incentives
• Incubation support
• Innovation grants
• Technology infrastructure

This aligns with UP’s ambition to expand its IT, electronics manufacturing and fintech footprint.

Infrastructure & Connectivity Boost

Infrastructure remains a cornerstone of the growth model.

The state welcomed the Centre’s announcement of high-speed rail corridors linking:

• Delhi – Varanasi
• Varanasi – Siliguri

These corridors are expected to dramatically improve connectivity, trade, and tourism.

Tourism infrastructure development includes major heritage sites such as:

• Sarnath
• Hastinapur

Additionally, the state plans to train 10,000 tourist guides, positioning tourism as a significant employment generator.

What This Means for UP’s Growth Story

The 2026–27 Budget reflects a multi-pronged strategy:

✔ Fiscal discipline
✔ Infrastructure-led growth
✔ Human capital investment
✔ Agricultural modernisation
✔ Startup and digital economy expansion
✔ Women-focused workforce inclusion

If execution matches intent, Uttar Pradesh could see accelerated industrialisation, improved rural incomes, stronger urban infrastructure, and expanded employment opportunities—potentially strengthening its contribution to India’s overall GDP growth.

However, experts note that timely implementation, transparency in spending, and measurable outcome tracking will be critical in translating allocations into tangible results.

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