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States – Union Budget 2026-27


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New Delhi, February 1

  • Odisha, Kerala, Andhra Pradesh and Tamil Nadu – mineral-rich States, establishment of dedicated Rare Earth Corridors to promote mining, processing, research and manufacturing.
  • Support to States to establish – 3 dedicated Chemical Parks, through challenge route, on a cluster-based plug-and-play model
  • Dedicated Freight Corridors connecting Dankuni in the East, to Surat in the West
  • Operationalisation of 20 new National Waterways (NW) over next 5 years, starting with NW-5 in Odisha to connect mineral rich areas of Talcher and Angul and industrial centres like Kalinga Nagar to the Ports of Paradeep and Dhamra. Training Institutes will be set up as Regional Centres of Excellence for development of the required manpower.
  • Ship repair ecosystem catering to inland waterways will also be set up at Varanasi and Patna; c) launch a Coastal Cargo Promotion Scheme for incentivising a modal shift from rail and road, to increase the share of inland waterways and coastal shipping from 6 % to 12 % by 2047.
  • Seven High-Speed Rail corridors between cities as ‘growth connectors’, namely i) Mumbai-Pune, ii) Pune-Hyderabad, iii) Hyderabad-Bengaluru, iv) Hyderabad-Chennai, v) Chennai-Bengaluru, vi) Delhi-Varanasi, vii) Varanasi-Siliguri.
  • Scheme to Support states in establishing – Five Regional Medical Hubs in partnership with the private sector. These Hubs will serve as integrated healthcare complexes that combine medical, educational and research facilities. Will have AYUSH Centres, Medical Value Tourism Facilitation Centres and infrastructure for diagnostics, post-care and rehabilitation. These Hubs will provide diverse job opportunities for health professionals including doctors and AHPs.
  • Set up 3 new All India Institutes of Ayurveda; (ii) upgrade AYUSH pharmacies and Drug Testing Labs for higher standards of certification ecosystem, and make available more skilled personnel; (iii) upgrade the WHO Global Traditional Medicine Centre in Jamnagar to bolster evidence-based research, training and awareness for traditional medicine.
  • Establish through challenge route, a new National Institute of Design to boost design education and development in the eastern region of India.
  • Support Indian Institute of Creative Technologies, Mumbai in setting up AVGC Content Creator Labs in 15,000 secondary schools and 500 colleges.
  • Support States, through challenge route – to establish 5 University Townships in the vicinity of major industrial and logistic corridor. Will host multiple universities, colleges, research institutions, skill centres and residential complexes.
  • Mountain trails in Himachal Pradesh, Uttarakhand and Jammu and Kashmir; Araku Valley in the Eastern Ghats and Podhigai Malai in the Western Ghats. (ii) Turtle Trails along key nesting sites in the coastal areas of Odisha, Karnataka and Kerala; and (iii) Bird watching trails along the Pulikat lake in Andhra Pradesh and Tamil Nadu
  • Development of 15 archeological sites including Lothal, Dholavira, Rakhigarhi, Adichanallur, Sarnath, Hastinapur, and Leh Palace into vibrant, experiential cultural destinations.
  • Focus on the Purvodaya States and the North-East Region to accelerate development and employment opportunities.
  • Integrated East Coast Industrial Corridor with a well-connected node at Durgapur, creation of 5 tourism destinations in the 5 Purvodaya States, and the provision of 4,000 e-buses.
  • Buddhist Sites in North-Eastern Region – Scheme for Development of Buddhist Circuits in Arunachal Pradesh, Sikkim, Assam, Manipur, Mizoram and Tripura. Scheme to cover preservation of temples and monasteries, pilgrimage interpretation centers, connectivity and pilgrim amenities.
  • NIMHANS-2 in North India and also upgrade National Mental Health Institutes in Ranchi and Tezpur as Regional Apex Institutions.
  • Support high value crops such as coconut, sandalwood, cocoa and cashew in coastal areas. Agar trees in North East and nuts such as, almonds, walnuts and pine nuts in hilly regions will also be supported.
  • Coconut Promotion Scheme to increase production and enhance productivity through various interventions 16 including replacing old and non-productive trees with new saplings/plants/varieties in major coconut growing States.
  • Partner with State Governments to promote focused cultivation and post-harvest processing to restore the glory of the Indian Sandalwood ecosystem
  • ₹1.4 lakh crore to the States for the FY 2026-27 as Finance Commission Grants. These include Rural and Urban Local Body and Disaster Management Grants. Accepted the recommendation of the 16th Finance Commission to retain the vertical share of devolution at 41%.

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