The Maharashtra Budget for 2025-26 was presented by Deputy Chief Minister Ajit Pawar, who also manages the Finance portfolio. This budget follows the Mahayuti government’s impressive win in the assembly elections and comes at a time of significant financial strain. The state is grappling with a record debt projection of Rs 9.3 lakh crore and an alarming revenue deficit, estimated at Rs 45,891 crore for the fiscal year 2025-26. Given these financial hurdles, the budget refrains from launching any major new initiatives and instead prioritizes the continuation of existing programs.
Financial Condition of Maharashtra
1. Rising Debt Burden
- The state’s total debt is projected to hit Rs 9.3 lakh crore, which is an increase of Rs 2 lakh crore from last year (2024-25), when it stood at Rs 7.1 lakh crore.
- If we look back a decade, this amount has nearly tripled.
- The fiscal deficit is estimated to be 2.76% of the Gross State Domestic Product (GSDP), and the debt-to-GSDP ratio is at 18.7%, comfortably below the 25% limit set.
2. Widening Revenue Deficit
The state’s revenue deficit, which is the difference between what it brings in and what it spends, is expected to hit Rs 45,891 crore. That’s more than double last year’s estimate of Rs 20,051 crore.
With such a tight financial situation, the government is finding it tough to roll out new welfare programs.
Key Budget Highlights
1. Existing Welfare Schemes Over New Announcements
The budget is all about keeping the current welfare programs running instead of introducing new ones. One of the key initiatives, the Mukhya Mantri Majhi Ladki Bahin Yojana, has experienced a budget cut of Rs 10,000 crore compared to last year. For the 2025-26 period, the total funding for this scheme stands at Rs 36,000 crore. Unfortunately, the planned increase in the monthly stipend from Rs 1,500 to Rs 2,100 has been postponed.
2. Farm Loan Waiver Deferred
- The Mahayuti government had pledged to provide a farm loan waiver in its election manifesto, but unfortunately, it didn’t make it into this year’s budget.
- Instead, the focus seems to be on maintaining the current agricultural programs.
3. Increase in District Annual Plan
- To strengthen local governance, the district annual plan has been hiked by 11%, increasing from Rs 18,165 crore to Rs 20,165 crore.
- This is significant as local body elections are approaching.
4. Social Justice Initiatives
The budget has made significant allocations for Scheduled Castes (SCs) and Scheduled Tribes (STs):
- The SC component of the annual plan has been increased by 42%.
- The ST component has been hiked by 40%.
Revenue Generation Measures
1. New Taxes on Motor Vehicles
- The government has proposed new taxes on motor vehicles, which are expected to generate Rs 1,125 crore in revenue.
2. Increase in Stamp Duty
- Stamp duty on certain transactions has been increased to boost revenue collection.
Infrastructure and Development Projects
- The budget does not announce new infrastructure projects, especially in the road sector.
- The focus remains on ongoing projects, ensuring their timely completion rather than launching new ones.
