Bihar State Budget 2026-27 Analysis

Key Highlights

• Total expenditure for 2026-27 is budgeted at Rs 3,24,925 crore excluding debt repayment of Rs 22,665 crore (gross outlay Rs 3,47,590 crore, the largest in Bihar's history) — up 10.5% over the 2025-26 budget estimate but 19% below the 2025-26 revised estimate.
• Fiscal deficit is targeted at Rs 39,112 crore, exactly 3.0% of GSDP — the annual limit recommended by the 16th Finance Commission for 2026-31 — after the 2025-26 revised estimate blew out to Rs 1,34,371 crore (11.8% of GSDP).
• The 2025-26 revised estimates show spending 36% above budget (Rs 4,00,465 crore vs Rs 2,94,075 crore), driven by the power subsidy, social security pensions, and the Mukhyamantri Mahila Rojgar Yojana, which paid an initial Rs 10,000 grant to 1.56 crore women.
• The state projects a revenue surplus of Rs 1,143 crore (0.1% of GSDP) for 2026-27, a sharp reversal from the Rs 76,315 crore revenue deficit (6.7% of GSDP) in the 2025-26 revised estimates.
• Nominal GSDP for 2026-27 is projected at Rs 13,09,155 crore, implying 15% growth — well above the Union budget's 10% national assumption.
• Revenue receipts are estimated at Rs 2,85,277 crore, of which 74% (Rs 2,10,074 crore) comes from the centre: Rs 1,58,178 crore as tax devolution and Rs 51,896 crore as grants-in-aid.
• Own tax revenue is budgeted at Rs 65,800 crore — just 5% of GSDP — with State GST the largest source at Rs 38,000 crore (58% of own taxes); prohibition means Bihar collects no state excise.
• Education gets the largest sectoral allocation at Rs 70,141 crore, 21.7% of expenditure versus the 14.5% all-state average, including Rs 12,107 crore for Samagra Shiksha Abhiyan.
• Committed expenditure of Rs 1,33,494 crore absorbs 47% of revenue receipts — salaries Rs 72,960 crore, pensions Rs 35,170 crore, interest Rs 25,364 crore — up from 39% in 2024-25.
• The Education Department's salary bill alone jumps from Rs 14,561 crore in 2024-25 to Rs 36,658 crore in 2026-27, reflecting mass teacher recruitment.
• Capital outlay is nearly flat at Rs 39,377 crore (vs Rs 38,527 crore actuals in 2024-25) — roughly 12% of net expenditure — with Rs 5,034 crore for roads and bridges and Rs 5,814 crore for irrigation and flood control.
• Outstanding liabilities are projected at 34.1% of GSDP at end-2026-27, a level the 16th Finance Commission has flagged as a concern; outstanding guarantees add Rs 32,008 crore (2.4% of GSDP).
• New announcements include the Jannayak Karpoori Thakur Kisan Samman Nidhi (Rs 3,000 per farmer per year atop PM-Kisan's Rs 6,000), five new expressways, 2,000+ EV charging stations, and phase-2 of the Gaya Industrial Manufacturing Cluster.