Finance Minister Nirmala Sitharaman is set to engage in pre-Budget consultations with state finance ministers on Friday in Jaisalmer, ahead of the presentation of the 2025-26 Union Budget.
“States are expected to play a major role in the consultations, advocating for policies that foster innovation, investment, and job creation. The meeting will be a platform for discussing the necessary steps to enhance economic stability and promote sustainable growth,” said a government official.
The source further added that the Budget consultations this year are especially imperative due to the political outcomes of recent state elections.
“With several states seeking additional support, the upcoming Budget could see specific demands for financial packages. Maharashtra, in particular, is expected to seek a targeted initiative to support its thriving micro, small, and medium enterprises (MSMEs). Maharashtra, being a hub for MSMEs, is planning a special package for this sector, as Prime Minister Narendra Modi continues to champion initiatives aimed at its growth,” said another official.
In Sitharaman’s 2024-25 (FY25) Budget, the government provided a financial package for Andhra Pradesh and Bihar that is expected to have cost the exchequer around Rs 20,000-30,000 crore, Business Standard reported on July 28. While Andhra Pradesh is expected to receive Rs 15,000-20,000 crore, Bihar is likely to get Rs 5,000-10,000 crore in FY25.
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During the pre-Budget meeting on Friday, several state governments are likely to raise concerns regarding the establishment of new manufacturing units. Mineral-rich states are likely to push for a larger share of revenue from central resources, arguing that it would help boost their local economies and attract further industrial investments.
“The Centre is expected to offer financial incentives for asset monetisation, particularly if states take an interest. Also, states are likely to make requests to develop key industrial hubs or establish new power plants. States like Jharkhand, Bihar, Karnataka, and West Bengal are also gearing up to request a larger allocation of revenue in the upcoming Union Budget, aimed at strengthening their local business environments,” the second official said.
Pre Budget Meet
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