Telangana State Budget 2026-27 Analysis
Budget EstimateTotal expenditure, revenue receipts, fiscal deficit, and department-wise allocation for Telangana FY 2026-27
Telangana State Budget 2026-27 Budget at a Glance
Total Receipts
Rs 2.41 lakh crore
+18.3%
Total Expenditure
Rs 3.01 lakh crore
+15.3%
Fiscal Deficit
3.0%
Rs 58,459 crore
Capital Expenditure
Rs 66,803 crore
+15.5%
Tax Revenue
Rs 1.48 lakh crore
-1.2%
Interest Payments
Rs 21,304 crore
7% of expenditure
Telangana Revenue Receipts 2026-27
Own tax revenue vs non-tax revenue breakdown
Telangana Expenditure Breakdown 2026-27
Revenue vs Capital spending and department allocation
Revenue vs Capital Split
Top 10 Departments by Allocation
Fiscal Deficit as % of GSDP โ Telangana 2026-27
The fiscal deficit for Telangana in 2026-27 is 3.0% of GSDP (Rs 58,459 crore), reflecting the state's borrowing needs to fund development programmes.
States are expected to maintain fiscal deficit within 3% of GSDP as per the FRBM Act. Telangana is maintaining fiscal discipline close to the recommended limit.
Interest payments at Rs 21,304 crore consume 7.1% of total expenditure.
Telangana State Budget 2026-27 โ Receipts & Expenditure Summary
| Particulars | Amount | % of Total |
|---|---|---|
| A. Total Receipts | Rs 2.43 lakh crore | 100% |
| 1. Revenue Receipts | Rs 2.41 lakh crore | 99.4% |
| a. Own Tax Revenue | Rs 1.48 lakh crore | 61.0% |
| b. Non-Tax Revenue | Rs 35,730 crore | 14.7% |
| B. Total Expenditure | Rs 3.01 lakh crore | 100% |
| 1. Revenue Expenditure | Rs 2.34 lakh crore | 77.8% |
| 2. Capital Expenditure | Rs 66,803 crore | 22.2% |
| of which: Interest Payments | Rs 21,304 crore | 7.1% |
| C. Fiscal Deficit | Rs 58,459 crore | 3.0% of GSDP |
Source: Telangana State Budget Documents via PRS India. All figures in Indian Rupees.
Telangana Department-wise Expenditure 2026-27
Top departments by allocation in Telangana for 2026-27
| Department โ | Revenue โ | Capital โ | Total โ | Share |
|---|---|---|---|---|
1. Welfare of SC, ST, OBC and Minorities | Rs 25,451 crore | Rs 9,432 crore | Rs 34,883 crore | 11.6% |
2. Education, Sports, Arts and Culture | Rs 26,273 crore | Rs 1,390 crore | Rs 27,663 crore | 9.2% |
3. Agriculture and Allied Activities | Rs 25,590 crore | Rs 96 crore | Rs 25,686 crore | 8.5% |
4. Social Welfare and Nutrition | Rs 24,349 crore | Rs 79 crore | Rs 24,428 crore | 8.1% |
5. Energy | Rs 20,573 crore | Rs 0 | Rs 20,573 crore | 6.8% |
6. Health and Family Welfare | Rs 12,049 crore | Rs 1,948 crore | Rs 13,997 crore | 4.6% |
7. Irrigation and Flood Control | Rs 881 crore | Rs 12,836 crore | Rs 13,717 crore | 4.6% |
8. Urban Development | Rs 12,941 crore | Rs 280 crore | Rs 13,221 crore | 4.4% |
9. Transport | Rs 5,753 crore | Rs 5,677 crore | Rs 11,430 crore | 3.8% |
10. Police | Rs 10,879 crore | Rs 474 crore | Rs 11,353 crore | 3.8% |
Telangana Budget 2026-27 Analysis & Highlights
Key Highlights
- Telangana's 2026-27 budget totals Rs 3,24,234 crore including debt repayment; net expenditure of Rs 3,01,209 crore is 15% above the 2025-26 revised estimate but only 5.7% above last year's budget estimate, reflecting an 8% mid-year downward revision in 2025-26.
- Fiscal deficit is targeted at Rs 58,459 crore, exactly 3.0% of GSDP โ the ceiling recommended by the 16th Finance Commission for 2026-31 โ after slipping to 3.2% of GSDP (Rs 56,133 crore) in the 2025-26 revised estimates.
- The state budgets a revenue surplus of Rs 6,858 crore (0.3% of GSDP), a sharp improvement on the Rs 591 crore surplus in RE 2025-26 and the Rs 9,420 crore revenue deficit recorded in 2024-25 actuals.
- Capital outlay jumps 30% to Rs 47,267 crore after three years stuck near Rs 36,000 crore, led by irrigation (Rs 12,836 crore), welfare-sector capital works including residential schools (Rs 9,432 crore), and roads and bridges (Rs 5,677 crore).
- The six guarantee schemes are allocated Rs 50,713 crore โ 21% of revenue receipts โ including Rythu Bharosa at Rs 18,000 crore, Cheyutha pensions at Rs 14,861 crore, Indiramma Houses at Rs 5,500 crore, and Mahalaxmi at Rs 4,305 crore.
- Revenue receipts are projected at Rs 2,41,264 crore, up 18% over RE 2025-26, with own tax revenue of Rs 1,48,186 crore (7.6% of GSDP) led by SGST at Rs 52,490 crore, sales tax/VAT at Rs 38,106 crore, and state excise at Rs 27,668 crore (+17%).
- Welfare of SC, ST, OBC and Minorities is the single largest sector at Rs 34,883 crore (+30%), absorbing 12.4% of Telangana's sectoral spending against a 31-state average of just 3.2%.
- Central grants are budgeted to more than double to Rs 24,166 crore (+117% over RE) โ an aggressive assumption given the state realised only 49% of its budgeted grants in 2025-26 and 37% in 2024-25.
- Outstanding public debt is estimated at Rs 5,62,363 crore (28.7% of GSDP) by end-2026-27, up from Rs 5,03,905 crore (28.3%) in RE 2025-26, with government guarantees adding another Rs 2,41,743 crore (14% of GSDP) as of February 2026.
- Interest payments of Rs 21,304 crore consume just 8.8% of budgeted revenue receipts, down from 17% in 2024-25, after the state government restructured debt to secure lower rates and longer repayment periods.
- Gross borrowings for 2026-27 are pegged at Rs 79,984 crore โ Rs 73,384 crore of it open market loans โ against debt repayment of Rs 23,025 crore, implying net borrowings of Rs 56,959 crore.
- New announcements include the Indiramma Family Life Insurance Scheme offering Rs 5 lakh cover per family from June 2026, two lakh new Cheyutha pensions, a milk-and-ragi-malt breakfast scheme up to intermediate level, and a CM Overseas Employment Programme.
- GSDP for 2026-27 is projected at Rs 19,61,701 crore (+10% nominal); Telangana's per-capita GSDP of Rs 4,20,347 in 2024-25 runs 79% above the national per-capita GDP of Rs 2,34,859.
Compare Telangana Budget โ Recent Years
Year-over-year comparison of key fiscal metrics
| Metric | 2022-23 | 2023-24 | 2024-25 | 2025-26 | 2026-27 |
|---|---|---|---|---|---|
| Total Expenditure | โ | โ | โ | Rs 2.61 lakh crore | Rs 3.01 lakh crore |
| Revenue Receipts | โ | โ | โ | Rs 2.04 lakh crore | Rs 2.41 lakh crore |
| Capital Expenditure | โ | โ | โ | Rs 57,832 crore | Rs 66,803 crore |
| Fiscal Deficit (% GSDP) | โ | โ | โ | 3.2% | 3.0% |
| Own Tax Revenue | โ | โ | โ | Rs 1.5 lakh crore | Rs 1.48 lakh crore |
Columns showing "โ" will populate as more data is ingested. Data from official budget documents via PRS India.
Understanding Telangana State Budget 2026-27
The Telangana state budget is the annual financial plan presented in the state legislature. It covers all revenue receipts, expenditure allocations across departments, and fiscal deficit management. State budgets are critical because states handle key development areas including education, health, agriculture, and infrastructure.
Telangana Revenue Sources
State revenue comes from three sources: own tax revenue (state GST, stamp duty, excise, vehicle tax), non-tax revenue (fees, fines, interest), and transfers from the Centre (share of central taxes as per Finance Commission recommendations, plus grants-in-aid for specific schemes).
Fiscal Deficit and State Borrowing
Under the FRBM framework, states target a fiscal deficit of 3% of GSDP. States can borrow from the market via State Development Loans (SDLs), and the central government also provides loans. The RBI manages the borrowing calendar for states to ensure orderly market conditions.
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Compare Telangana with other states
Side-by-side comparison of fiscal metrics across Indian states