Bengaluru, 6 March

Karnataka Chief Minister Siddaramaiah on Friday presented his record 17th budget, pegging the state's total expenditure for FY 2026-27 at over Rs 4.48 lakh crore, while stressing that the government was pursuing a development strategy that balances welfare programmes with investments in infrastructure and long-term economic transformation.

Lashing out at the BJP-led NDA government at the Centre, he said that by not adhering to the federal system of governance as per the Constitution, the former was doing "injustice" to Karnataka.

His government was pursuing a development strategy that balances welfare programmes with investments in infrastructure and long-term economic transformation, and urged the Union government to be more sensitive to the state's demands.

In his budget speech, Siddaramaiah said Karnataka remains at the forefront of the nation's development and is among the largest contributors of tax revenues to the country.

Among other things, he reaffirmed the state's commitment to pursuing the Mekedatu balancing reservoir project on the Cauvery and announced a social media ban for children under 16.

"Our state is at the forefront in all sectors of the nation’s development; it is one of the key states that contributes the highest tax revenues,” he said.

Total expenditure for 2026-27 is estimated at Rs 4,48,004 crore, Siddaramaiah said. This is the 17th budget that he presented in his political career.

Drawing an analogy from the epic tradition, the chief minister said, "The cow that yields abundant milk requires proper care. It is Bheeshma’s philosophy that if it becomes weak, the entire cowherd suffers".

He said the Union government should recognise this and respond sensitively to the state’s demands. Siddaramaiah also emphasised the importance of cooperative federalism for a diverse country like India.

"A nation like India, with its diverse cultures, can achieve development only through a cooperative federal system,” he said.

Highlighting the government's flagship welfare initiatives, the chief minister said the Congress government prioritised economic security and social stability soon after coming to power in 2023 through the Guarantee Schemes, which are based on the concept of universal basic income.

"Major studies in India and abroad show that these schemes are improving the financial condition of crores of families and increasing people’s purchasing power," he said.

At the same time, Siddaramaiah said the government has also focused on capital investment, infrastructure development and long-term economic transformation. Citing economist Amartya Sen, he said economic development that neglects investment in human development is not only unstable but also unethical.

"We are investing in welfare schemes for the people with this understanding," he said.

The chief minister said the government is developing a Karnataka-specific economic framework described as the '11G model' to guide the state’s growth.

According to him, the model includes components such as a guarantee economy promoting welfare and gender equality; good public education aimed at universal access to quality education; good health for all through comprehensive healthcare; a grassroots economy focused on agriculture and rural development; and good governance through people-friendly administration.

He also said that the model incorporates gig economy initiatives for labour welfare; Geographical equality to reduce regional disparities; a global trade economy to promote trade and industry; a tourism-driven, globe-trotting economy; a green economy encouraging renewable energy and environment-friendly activities; and a growing urban economy supporting sustainable urban growth.

"These economic principles form the basis on which we are steering the chariot of the state’s development," Siddaramaiah said, adding that the finance department’s budget documents elaborate on how the framework defines Karnataka’s unique development model.

Siddaramaiah accused the Centre of treating Karnataka unfairly by disregarding the constitutional principles of cooperative federalism.

"Reduced Central share in centrally sponsored schemes, discriminatory allocation in Central Sector schemes, injustice due to 15th Finance Commission's revenue sharing formula, non-implementation of special grants, recommended by the same commission and the untimely rationalisation of the GST rates have all led to additional burden and pressure on the state exchequer," Siddaramaiah said.

Centre "systematically" weakened the Mahatma Gandhi National RuralEmployment Guarantee Act (MGNREGA).

Siddaramaiah said a weak rural employment scheme threatens the people's right to employment and increases the financial burden on states.

"Under such circumstances, everyone must unite across party lines to safeguard the interests of the state and assert its rightful claims," the CM said.

He also said that rate restructuring resulted in reduced GST collections by Rs 10,000 crore for the current fiscal year in Karnataka, and there will be a reduction of Rs 15,000 crore next year.

Siddaramaiah further said that Karnataka continues to demonstrate strong fiscal performance and robust revenue mobilisation capacity. Despite structural challenges due to the Centre's tax policy changes, Karnataka's own revenue collection exhibited resilience, he claimed.