Mumbai: On March 10, 2025, Maharashtra’s Deputy Chief Minister and Finance Minister, Ajit Pawar, presented the state’s budget for the fiscal year 2025-26. This budget, totaling ₹7,00,020 crore, comes at a time when the state is grappling with significant economic challenges, including a projected debt of ₹9.3 lakh crore and a revenue deficit of ₹45,891 crore for the upcoming fiscal year. Despite these hurdles, the budget outlines strategic allocations aimed at infrastructure development, social welfare, and economic growth.
Economic Context and Fiscal Health
The budget reveals Maharashtra’s highest debt projection in its history, estimated at ₹9.3 lakh crore, alongside a substantial revenue deficit of ₹45,891 crore for 2025-26. These figures highlight the state’s constrained financial position, necessitating careful planning and prioritization in budgetary allocations.
Infrastructure Development Initiatives
A significant portion of the budget is earmarked for infrastructure projects, reflecting the state’s commitment to enhancing its urban landscape and transportation networks:
- Mumbai Infrastructure: An allocation of ₹64,000 crore is dedicated to various infrastructure projects in Mumbai. This investment aims to bolster the city’s status as a financial hub and improve the quality of life for its residents.
- Road Network Expansion: The state plans to develop a 1,500 km road network and upgrade 7,000 km of existing roads to cemented roads in the coming year. This initiative is expected to enhance connectivity and support economic activities across Maharashtra.
- New Airport Development: Recognizing the need for improved air connectivity, the budget proposes the construction of a third airport near the Vadhvan port in Palghar district. This project aims to accommodate the growing air traffic demand and stimulate regional economic growth.
Social Welfare Programs
The budget emphasizes social welfare, with notable allocations aimed at supporting vulnerable populations:
- Mukhyamantri Majhi Ladki Bahin Scheme: An allocation of ₹36,000 crore is designated for this flagship scheme, which focuses on empowering women and promoting gender equality. However, the anticipated increase in the monthly allowance from ₹1,500 to ₹2,100, as promised during the election campaign, was not addressed in this budget.
- District Annual Plans: To promote balanced regional development, the budget increases the district annual plan outlay by 11%, from ₹18,165 crore to ₹20,165 crore. This increment is expected to fund local infrastructure projects and social programs tailored to the specific needs of each district.
Economic Growth and Employment
The budget outlines several initiatives aimed at stimulating economic growth and generating employment:
- New Industrial Policy: The government announced a new industrial policy targeting an investment of ₹40 lakh crore and the creation of 50 lakh jobs over the next five years. This policy aims to attract both domestic and foreign investors by offering incentives and creating a conducive business environment.
- Employment Generation: The state aims to provide employment to 16 lakh people through Memorandums of Understanding (MoUs) worth ₹15.72 lakh crore signed with 56 companies at the World Economic Forum in Davos 2025. This initiative underscores Maharashtra’s commitment to becoming a preferred investment destination.
Tax Reforms and Revenue Generation
To address the fiscal deficit, the budget proposes several tax reforms aimed at increasing revenue:
- Motor Vehicle Tax: The government proposes a 1% increase in the Motor Vehicle Tax on CNG and LPG vehicles. Additionally, a 6% tax is proposed on electric vehicles priced above ₹30 lakh. These measures are expected to generate additional revenue and promote environmental sustainability by encouraging the use of more affordable and eco-friendly vehicles.
- Stamp Duty Adjustments: The budget includes a hike in stamp duty on certain transactions, aiming to boost revenue from property registrations. This measure is anticipated to have implications for the real estate market and requires careful monitoring to balance revenue generation with market stability.
Sector-Specific Allocations
The budget also focuses on specific sectors to drive comprehensive development:
- Agriculture: To promote the integration of technology in agriculture, the budget announces a pilot project involving 50,000 farmers over 1 lakh acres. This initiative aims to leverage artificial intelligence to enhance productivity and sustainability in the agricultural sector.
- Tourism and Ports: The government plans to boost passenger shipping and coastal tourism by exempting passenger and port taxes. Additionally, the maximum duration of port agreements has been extended to 90 years, ensuring long-term investment stability in the sector.
Opposition’s Response
The opposition Maha Vikas Aghadi (MVA) criticized the budget, accusing the ruling Mahayuti government of neglecting key promises made during the election campaign. They highlighted the omission of the proposed hike in the Mukhyamantri Majhi Ladki Bahin Scheme allowance and questioned the feasibility of the ambitious infrastructure projects given the state’s fiscal constraints.
The Maharashtra Budget 2025 reflects a delicate balancing act between ambitious development goals and the stark reality of fiscal limitations. While significant allocations are made for infrastructure development and social welfare, the substantial debt and revenue deficit pose challenges to the effective implementation of these initiatives. The success of this budget will hinge on prudent fiscal management, efficient execution of projects, and the state’s ability to stimulate economic growth to enhance revenue streams. As Maharashtra navigates these economic challenges, the government’s commitment to transparency and accountability will be crucial in achieving the envisioned development outcomes.
