Aiming at building a ‘Vikasit Madhya Pradesh’, the key highlights of the Budget 2025-26 are the following: emphasis on empowering GYAN( Gareeb, Yuva, Annadaata, Naari); a first time Zero based budgeting(ZBB)based budget wherein every item of expenditure has been critically examined for its utility and relevance; a budgetary size or government spending of Rs 421, 032 crores representing an over 15 percent increase over the previous year budget; a revenue surplus of Rs 618 crores; a fiscal deficit equal to 4.66 percent of the Gross State Domestic Product(GSDP); a state debt that equals 29.5 percent of the GSDP; an interest payment that equals 9.84 percent of the state’s revenue receipts and a huge Rs 18,619 crores allocation for the Mukhya Mantri Ladli Behna Yojna.
While on the one hand, FM Devda has pushed for the erstwhile Shivraj Singh Chauhan’s government’s themes of economic growth and social welfare, he has simultaneously backed the present incumbent CM Mohan Yadav’s emphasis on industrialisation and employment.
The previous BJP government in the state had sought to achieve economic growth by focusing on infrastructure development and agricultural growth. The FM has sanctioned Rs 70, 515 crores for infrastructure and Rs 39, 207 crores for farmer welfare. Economic theory also tells us that investment spending or capital expenditure is the key determinant of economic growth. Capital expenditure as a proportion of the GSDP is a whopping 5.02 percent for the year 2025-26; representing a massive 31 percent increase over the previous year.
The FM has also provided liberally for the marginalised sections of the state with a view to promote social welfare. He has allocated Rs 26,532 crores for Women and Child Development, Rs 14,463 crores for tribal welfare and Rs 2250 crores on schemes related to scheduled caste welfare.
Having done that, the FM has also driven the current CM Mohan Yadav’s economic agenda too. The present BJP government has declared the year 2025 as the ‘Udyog and Rozgar Varsh’ , it has held regional industry conclaves at divisional level and a Global Investors Meet in February 2025 that was inaugurated by the PM and fetched 89 MOUs worth
The FM has provided for Rs 3250 crores as incentives for industries and a sum of Rs 1667 crores for MSME development; it must be underscored here that MSME sector is regarded by economists as very labour intensive in its growth. Besides, the FM has also allotted Rs 4635 crores for employment creation in the budget.
Has the FM managed to achieve a sense of fiscal discipline amidst these huge sectoral spends? It seems so if one were to go by data and evidence. He has managed a Rs 618 crores of revenue surplus in 2025-26 which is commendable. The Reserve Bank of india(RBI) has given the topmost ‘A’ rank to Madhya Pradesh for fiscal reform in 2024-25 and has also found out that MPs social and developmental spending is better than the national average in qualitative terms. Likewise, the Niti Ayog has ranked the state 1st in the country in terms of quality of budget spending.
In a nutshell, the Finance Minister Jagdish Devda has definitely generated some optimism about the prospects of economic growth, industrial growth, social welfare and jobs creation in the state.
The writer is the former All India Convenor, BJPs Economic Cell