Trying to balance welfare and development, the Andhra Pradesh government on Saturday presented a Budget of more than Rs 3.32 lakh crore for 2026-27. It said the state is financially “yet to come out of the woods” after the “mess” left by the previous YSRCP government.
The total budget size has gone up by Rs 10,000 crore compared to FY26. Revenue expenditure is estimated at Rs 2.56 lakh crore, while capital expenditure is close to Rs 54,000 crore.
While presenting the Budget in the Assembly, Finance Minister Payyavula Keshav has stated that the estimated revenue deficit would be about Rs 22,000 crore. This is around 1.11 per cent of the Gross State Domestic Product (GSDP).
“From the financial standpoint, we are yet to come out of the woods. The situation is not very rosy. I still face difficulties while sorting out the financial mess left by the previous regime. But our intentions are firm,” Keshav said.
The government said it has prepared an economic master plan for the Visakhapatnam Economic Region (VER). The plan includes seven growth drivers and 41 high-impact projects, with a proposed investment of Rs 28,000 crore, including metro rail projects.
The state will also launch an “AP Wealth Fund”. The government said it aims to build it on the lines of sovereign wealth funds like those of Norway and Abu Dhabi to help run the state. “It is proposed to set up an AP Wealth Fund with a seed corpus of Rs 100 crore,” he added.
Thanking Prime Minister Narendra Modi for starting the process to give statutory status to the greenfield capital city of Amaravati, he said administrative sanction has been given for 97 works amounting to Rs 57,868 crore there.
According to the budget, the state plans to raise Rs 76,000 crore through open market loans and Rs 19,000 crore from the Union government. The GSDP for 2026-27 is estimated at Rs 19.75 lakh crore. Public debt is likely to rise to Rs 7.11 lakh crore in 2026-27, up from Rs 6.35 lakh crore in FY26. The Budget has proposed Rs 51,021 crore for the BC component. School Education has been allotted Rs 32,308 crore.
An amount of Rs 19,306 crore has been set aside for the Health, Medical and Family Welfare Department. The Panchayati Raj and Rural Development Department, headed by Deputy Chief Minister Pawan Kalyan, has been given about Rs 23,000 crore. Major allocations include Rs 18,224 crore for Water Resources. Municipal Administration and Urban Development has received Rs 14,539 crore, Agriculture Rs 11,745 crore, Social Welfare Rs 11,119 crore and EWS Welfare Rs 10,700 crore.
For welfare schemes, the state has allocated Rs 27,719 crore for the NTR Bharosa scheme. It provides a monthly welfare pension of Rs 4,000 to eligible beneficiaries. Apart from this, Rs 2,601 crore has been set aside for the Deepam 2.0 scheme, which offers three free cooking gas cylinders per year. Another Rs 2,320 crore has been allocated as economic support to various communities.
The Stree Shakti scheme, which provides free bus travel for women, has received Rs 1,420 crore for the next financial year. Rs 600 crore has been allocated for power subsidies for weaker sections.
Thalliki Vandanam, which gives Rs 15,000 per year for each school-going child, has been allotted Rs 9,668 crore. Woman and Child Welfare has received Rs 4,581 crore, and scholarships have been allocated Rs 3,838 crore. Annadata Sukhibhava, which provides Rs 20,000 per year to farmers, has been given Rs 6,600 crore.
Higher Education has received Rs 2,566 crore. Rs 707 crore has been set aside for PM Schools for Rising India and Rs 438 crore for Youth Advancement and Sports, among others. The Budget has also allocated Rs 8,365 crore for the rural employment guarantee programme Viksit Bharat Guarantee for Rozgar and Ajeevika Mission Grameen (VB G-RAM-G).
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