Karnataka Budget 2025 Highlights: Major boost for Brand Bengaluru, liquor prices may rise

Karnataka CM Siddaramaiah announced Bengaluru City University’s renaming after Dr Manmohan Singh while presenting the 2025 state Budget. The budget prioritizes infrastructure, healthcare, and urban development, with major allocations for roads, flyovers, metro expansion, and a ₹413 crore health program, strengthening Brand Bengaluru initiatives.

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• Grey water management units to be established in 500 villages to improve wastewater management.
• Spice and fruit crops to be cultivated across 5,000 acres under a mixed crop system, in collaboration with rural self-help groups.
• 5,000 km of state and district roads in rural areas to be lined with saplings to promote greenery.
• ‘Krishi Patha’ scheme to be launched for the development of farm access roads in a phased manner.
• Krishi Kavacha Scheme to enhance groundwater recharge and soil conservation by constructing bunds across 50,000 hectares of farmland.

The Karnataka Budget 2025-26 allocates ₹4,09,549 crore, focusing on Bengaluru’s infrastructure, traffic, and public safety. Key projects include tunnel roads, metro expansion, flyovers, and drainage upgrades. ₹1,800 crore is set for ‘Brand Bengaluru,’ alongside security enhancements, minority welfare, and revenue-boosting reforms.

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Unemployed individuals from Backward Class Communities will receive financial assistance of up to Rs 3 lakh per person.

The support aims to empower beneficiaries by helping them purchase electric four-wheelers or set up food kiosks, fostering self-employment and entrepreneurship.

The beneficiary contribution under Pradhan Mantri Awas Yojana (Urban) has been reduced to Rs 1 lakh, with the state government covering Rs 5 lakh on their behalf.

The Karnataka Slum Development Board has sanctioned the construction of 1,80,253 houses, with 86,651 already completed. The remaining houses will be fast-tracked to ensure timely completion.

The government has earmarked Rs 100 crore for the development of Jain, Buddhist, and Sikh communities, along with Rs 250 crore for the Christian community.

The monthly honorarium for Jain priests, Chief Granthis of Sikhs, and Pesh-Imams of mosques will be increased to Rs 6,000, while Assistant Granthis and Muezzins will receive Rs 5,000 per month.

Additionally, multi-purpose halls will be constructed to support cultural and social events for minority communities. These halls will be built at a cost of Rs 50 lakh at hobli and taluk levels and Rs 1 crore at district headquarters and city corporation areas.

The Karnataka government has projected total expenditure of Rs 4.09 lakh crore for 2025-26. This includes revenue expenditure of Rs 3,11,739 crore, capital expenditure of Rs 71,336 crore, and loan repayment of Rs 26,474 crore.

Opposition protests against state government during Karnataka Assembly Budget Session.

The Karnataka government has projected total receipts of Rs 4.08 lakh crore for the 2025-26 financial year. This includes total revenue receipts of Rs 2,92,477 crore, comprising own tax revenue of Rs 2,08,100 crore, non-tax revenue of Rs 16,500 crore, and Rs 67,877 crore from the Government of India. Additionally, the state anticipates gross borrowings of Rs 1,16,000 crore and non-debt capital receipts of Rs 170 crore, bringing the total estimated receipts to Rs 4,08,647 crore.

Karnataka Budget 2025-26 prioritizes fiscal discipline, Bengaluru infrastructure, minority welfare, and economic growth with an expenditure of Rs 4.09 lakh crore.

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• Tribal Empowerment: 13 tribal communities to get direct employment opportunities in state civil services.
• Healthcare Expansion: New Trauma Care Centres to be set up in Badami and Chitradurga.
• Agricultural Growth: Mandya to get a new Agricultural University to boost research and education.
• Economic Overview: Total borrowings for the year set at Rs 1.16 lakh crore.
• Industrial Development: Japanese Industrial Park to be developed in Tumkur.
• Sustainable Farming: Rs 20 crore allocated to promote Organic and Millet cultivation.
• Weaver Support: Rs 100 crore assistance for weavers, with subsidy eligibility extended to powerloom setups up to 20 HP.
• Entrepreneurship for SC Youth: Fast food trucks to be provided under a self-employment scheme.
• Textile Growth: New textile parks to be established in Karkala, Ranibennur, Raichur, Kadur, and Chikmagalur.
• Tribal Welfare: 47,859 tribal families to receive nutritious food kits under a Rs 120 crore scheme.

• Global Education Aid: Eligible students admitted to prestigious institutions like the London School of Economics (LSE) and Columbia University will receive Rs 1 crore in financial assistance.
• Upgrading Residential Schools: 31 residential schools for SC/ST and backward class students will be upgraded to PU colleges to improve educational access.
• Infrastructure Development: 61 KREIS residential schools to receive new buildings at a cost of Rs 1,292 crore.
• Scholarship Support: Rs 120 crore allocated to ensure the continuation of student scholarships, benefiting marginalized communities.

Karnataka CM Siddaramaiah presented the 2025-26 budget, allocating Rs. 51,034 crores for guarantee schemes while ensuring fiscal discipline and economic growth.

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• Agriculture Boost: Rs 7,145 crore allocated to the Agriculture Department; 49,790 acres brought under micro-irrigation, with plans to develop 30 more lakes to expand irrigation by 1,77,000 acres.
• Education Initiatives: 500 new Karnataka Public Schools to be set up with Rs 2,500 crore funding from the Asian Development Bank. Special training programs for minority students to prepare for competitive exams.
• Infrastructure & Development: Modern centralised bus station to be built at Bannimantap, Mysuru. New Rajiv Gandhi Health University to be established in Belagavi. Rs 234 crore earmarked for lake preservation in Bengaluru.
• Welfare Measures: Monthly honorarium increased by Rs 1,000 for government school cooks and Rs 2,000 for guest teachers and lecturers.
• Cultural Support: Badami Chalukya Utsav celebrations to receive Rs 2 crore in government funding.

The Karnataka Housing Board (KHB) will develop 16,140 sites in Suryanagar, Anekal Taluk, Bengaluru, with 50% of developed land allocated to landowners and the rest available for public sale or allotment. To strengthen food security, new fair price shops will be opened for distributing subsidized rice under the ‘Anna Bhagya’ scheme. Additionally, the state will launch the ‘Akka (Sister) Cooperative Society’ to support women entrepreneurs. Beneficiaries of the Gruha Lakshmi scheme—receiving Rs 2,000 per month—will be integrated into Stree Shakti Sanghs to promote women’s empowerment.

A new nursing college will be established in Yadgir, along with nursing colleges in Kalburgi and Jevargi, to strengthen healthcare education in the region. The government has allocated Rs 26,735 crore for rural development, focusing on infrastructure and livelihood improvements. In animal husbandry, 50 new veterinary clinics will be set up in 2025-26, with plans to establish 100 veterinary institutions in partnership with NABARD, enhancing veterinary care across rural Karnataka.

A silkworm market will be established in Mysore in collaboration with NABARD, providing better market access for silk farmers in the region. To boost urban development, Rs 2,000 crore has been allocated to Mahanagara Palikes. Additionally, Rs 55 crore has been earmarked under the Pre- and Post-Silkworm Activity Development Scheme to expand silk farming across the state.

In a major push for safety and security, the government will establish 60 additional women-only police stations across Bengaluru.

To further enhance surveillance, 7,500 CCTV cameras will be installed at key locations in the city.

A total of Rs 667 crore has been allocated to upgrade safety infrastructure and strengthen law enforcement.

CM Siddaramaiah introduced the Industrial Policy 2025-30, aiming for 12% industrial growth and the creation of 20 lakh jobs by 2030. This year, the sector has already recorded 5.8% growth. To attract large-scale investments, the government has allocated Rs 13,692 crore in financial assistance and subsidies.

• Liquor Price Revision: Prices likely to be reviewed and increased to align with rates in neighboring states.
• Excise Revenue Target: Rs 36,500 crore collected last year; new target set at Rs 40,000 crore.
• Support for Areca Nut Farmers: Rs 62 crore allocated to aid over 2 lakh Malnad growers affected by leaf spot disease.
• Construction Worker Welfare: Ex-gratia for on-the-job fatalities doubled from Rs 75,000 to Rs 1.5 lakh; New residential schools to be built for their children.
• Education for Social Change: CM Siddaramaiah quotes Savitribai Phule, highlighting education as a tool to break caste barriers.

The government will allocate Rs 50 crore to enhance tourism across 10 districts, with a focus on developing key destinations. Special emphasis will be placed on beach tourism in Dakshina Kannada, Udupi, and Uttara Kannada, along with improved road connectivity in coastal areas for better accessibility. Belur, Halebidu, and Somnathpur will see upgrades in basic amenities, while the Tourist Friends network will expand to 1,000 trained guides. Additionally, efforts will be made to secure World Heritage Site status for the historic Lakkundi temples.

• New Agricultural College: Experts to be recruited for setting up a new agricultural college in Belagavi.
• Support for Minority Communities: Rs 50,000 assistance for minorities opting for simple marriages.
• Bengaluru Haj Bhavan: Additional facilities to be developed.
• Transparency in Governance: Counseling to be introduced for revenue department transfers to ensure fairness.
• Christian Community Development: Rs 250 crore allocated for welfare programs.
• Gurudwara Development: Rs 2 crore grant for facility enhancement.
• Horticulture Boost: Rs 95 crore allocated for advanced farming technology.
• Healthcare Expansion: A multispeciality hospital to be set up in Koppal.
• Infrastructure Development: The Chief Minister’s Infrastructure Development Program launched with Rs 8,000 crore to drive state growth.
• Waqf Properties Maintenance: Rs 150 crore allocated for upkeep of Waqf properties and Muslim graveyards.
• Farmer Education: A Knowledge Bank to be established at IISc to educate farmers on production, crop health, and markets.
• Self-Defense Training: 25,000 students in 169 minority hostels to receive self-defense training.
• New Healthcare Facility: Kidwai (Nephrology) Hospital to be established in Raichur.
• Skill Development: New Industrial Training Institutes (ITIs) to be set up in minority-dominated areas.
• Higher Education Support: State funding for eligible minority students studying abroad increased from Rs 20 lakh to Rs 30 lakh.

Non-tax revenue for 2024-25 is projected to reach Rs 14,500 crore, exceeding annual targets and marking a 10.5% increase from the previous year. However, its share in GSDP and own tax revenue has remained stagnant in recent years, highlighting significant potential for further growth.

A 18.5 km North-South tunnel connecting Hebbal Esteem Mall to Silk Board Junction will be built at an estimated cost of Rs 15,000 crore to reduce Bengaluru’s traffic congestion. Additionally, a 28.5 km tunnel from KR Puram to Nayandanahalli is planned, with a project cost of Rs 28,000 crore.

The government has launched several initiatives to enhance the state's education sector. 50 high schools will be upgraded, and 500 new government schools will be established. Additionally, 100 government primary schools will receive improved infrastructure. To enhance student accommodation, Rs 25 crore has been allocated for hostel repairs. Agricultural education will also see a boost with the establishment of a new agricultural college in Athani.

Under the Brand Bengaluru initiative, Rs 1,800 crore has been allocated for 21 projects.

Additionally, Rs 3,000 crore has been set aside to tackle weather-related challenges and upgrade drainage and sewage treatment infrastructure.

The Cauvery Water Supply Project Phase 5 will receive Rs 555 crore, ensuring drinking water access to 110 villages.

Over the next two years, the Bengaluru Metro will expand to 98.60 km, enhancing connectivity to Devanahalli.

• New sports science research centres to be established in Belagavi and Mysuru.
• Upper Bhadra Irrigation Project allocated Rs 5,300 crore in the budget.
• 4% reservation for Muslims introduced in government tenders and contracts.
• Annual salary of temple priests increased from Rs 60,000 to Rs 72,000.
• Jain, Buddhist, and Sikh Development Corporations each granted Rs 100 crore.
• Centralised accommodation booking system to be implemented for temple stays.
• Film production to be officially recognised as an industry to attract investments.
• State to float own OTT to help develop Kannada language programmes.

Bengaluru is set to receive Rs 40,000 crore worth of tunnel road projects to address traffic congestion. Additionally, the Bengaluru Metro will be extended to Devanahalli, providing direct connectivity to the airport.

• Toor Dal Support Price: Rs 450 per quintal to encourage cultivation
• Anganwadi Workers: Honorarium increased by Rs 1,000 per month
• Tax Share Demand: CM stresses Karnataka must get rightful share of central taxes
• Gruha Jyoti Scheme: Rs 10,100 crore allocated for 200 units of free power
• Foreign Investments: Karnataka ranks 3rd, attracting $4.4 billion in 2024-25
• Modern Flower Market: Coming up in Chikkaballapur
• Hitech Fisheries Darshini: Planned for Mysuru
• Mega Dairy: Rs 50 crore investment for Kalaburagi (Kalburgi)
• Multiplex Ticket Cap: Maximum ticket price fixed at Rs 200 across the state

To accelerate economic growth and job creation, the government has introduced targeted policies across key sectors, including industries, IT, tourism, and biotechnology. These initiatives aim to leverage the state's human capital while attracting investments worth approximately Rs 1 lakh crore. To support this drive, Rs 13,500 crore has been allocated in subsidies and financial assistance, ensuring businesses and industries receive the necessary support to thrive and expand.

Bengaluru University has been officially renamed Dr. Manmohan Singh Bengaluru University as a tribute to the former Prime Minister and esteemed economist.

Karnataka’s agriculture sector has recorded over 3.8% growth in 2024-25, driven by favorable monsoons and proactive government initiatives supporting sowing and irrigation. Ample rainfall and well-filled reservoirs have further strengthened this robust expansion.

The government plans to develop 500 public schools with an estimated investment of Rs 2,500 crore, aiming to improve learning environments across the state. Additionally, to tackle malnutrition, a nutrition initiative will provide school children with an egg or banana six days a week, benefiting 53 lakh students across Karnataka.

Karnataka's economic growth has surpassed the national average, solidifying its status as one of the fastest-growing states in India. In 2024-25, the state achieved an impressive 7.4x growth, reinforcing its position as an economic powerhouse.

As part of a major education initiative, 500 government public schools will be extensively upgraded with an investment of Rs 2,500 crore.

The budget earmarks Rs 8,916 crore for Bengaluru’s development, aiming to enhance the city’s infrastructure and public services.

Education and healthcare emerged as key priorities, with increased allocations focused on improving access and quality. The budget also emphasizes urban development, directing greater financial support towards infrastructure enhancements in cities and towns to tackle rising civic challenges. CM Siddaramaiah stated that the government will develop Tier 2 and Tier 3 cities to ease the burden on Bengaluru.

CM Siddaramaiah staunchly defended the state's flagship guarantee schemes, emphasizing that they are not mere “free gifts” but vital initiatives designed to alleviate the struggles of the underprivileged and promote social justice.

Chief Minister Siddaramaiah began his 2025-26 budget presentation with verses from Rashtra Kavi Kuvempu and other renowned poets, infusing a literary essence into the proceedings. He invoked the ideals of Dr. B.R. Ambedkar, Buddha, Basavanna, and Narayana Guru, emphasizing the government’s commitment to social justice.

Owing to his ongoing recovery from knee surgery, the CM sought the Speaker’s permission to deliver his budget speech while seated—an uncommon gesture that marked the session’s tone.