With an outlay larger than Bangladesh’s national Budget, Uttar Pradesh’s Rs 9.12 lakh crore spending plan underlines the state’s rising fiscal heft, infrastructure push and disciplined deficit management.
Uttar Pradesh has unveiled a Rs 9,12,696.35 crore Budget for 2026–27—a headline figure that exceeds the annual outlay of neighbouring Bangladesh. The number is more than symbolic. It reflects a deeper shift: India’s most populous state is now operating at a fiscal scale comparable to sovereign economies.
Bangladesh’s FY2025–26 Budget stands at Tk 7.9 trillion (around Rs 5.85 lakh crore), with a projected deficit of Tk 2.26 trillion, or 3.6 per cent of GDP. In raw size, Uttar Pradesh’s Budget is substantially larger.
The demographic contrast is equally striking. Uttar Pradesh governs nearly 250 million people—far more than Bangladesh’s 175.7 million. In administrative terms, Lucknow manages a population base larger than most countries.
The comparison, of course, has limits. Bangladesh finances defence, diplomacy, currency management and external debt—responsibilities a state government does not shoulder within India’s federal structure. Yet even after accounting for these structural differences, Uttar Pradesh’s fiscal trajectory underscores its expanding economic weight within the Indian Union.
Beyond the headline comparison, however, this Budget is fundamentally about Uttar Pradesh’s recalibrated growth strategy.
The 2026–27 outlay marks a 12.9 per cent increase over the previous year, signalling continuity in an infrastructure-led expansion model while maintaining fiscal prudence.
Fiscal consolidation with expansion
The state has pegged its fiscal deficit at 3 per cent of Gross State Domestic Product (GSDP), broadly aligned with fiscal responsibility targets. More significantly, the debt-to-GSDP ratio — which had climbed to 33.4 per cent during the pandemic — is projected to decline to 23.1 per cent by 2026–27. That signals an attempt to balance expansion with consolidation.
Infrastructure at the core
Capital expenditure accounts for 19.5 per cent of the total Budget — a sizeable allocation by subnational standards. The government has earmarked Rs 27,103 crore for infrastructure and industrial development, a 13 per cent rise over the previous year, reinforcing the state’s emphasis on roads, connectivity, logistics and industrial corridors as growth multipliers.
Social sector push
Infrastructure is only one part of the story. Social development remains central to the spending strategy.
Education accounts for 12.4 per cent of the total outlay, while health receives 6 per cent. The Medical, Health and Family Welfare Department has been allocated Rs 37,956 crore—a 15 per cent increase year-on-year. Medical education alone gets Rs 14,997 crore.
Institutional expansion has been rapid. Uttar Pradesh now has 81 medical colleges, and MBBS seats have nearly tripled since 2017—reflecting a deliberate push to strengthen healthcare access while building long-term human capital.
Growth momentum
The state’s GSDP for 2024–25 is projected at Rs 30.25 lakh crore, with an estimated growth rate of 13.4 per cent. Per capita income, which has more than doubled since 2016–17, is expected to reach Rs 1.2 lakh in 2025–26.
Comparisons with sovereign budgets will always have structural caveats. Yet the scale itself is telling.
At over Rs 9.12 lakh crore, Uttar Pradesh’s Budget signals more than incremental expansion. It marks the rise of Indian states as economic engines operating at magnitudes once associated only with nations—and positions Uttar Pradesh at the forefront of that transformation.
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