Chief Minister Siddaramaiah is gearing up to unveil his 16th budget on Friday, a milestone that will bring him just one shy of the record set by Gujarat’s Vajubhai Vala, who presented 17 budgets. However, Siddaramaiah’s task is far from simple, with several hurdles, including health concerns. Owing to knee pain, he may present his budget speech while seated, following consultations with his doctors till late Thursday.

As Karnataka enters a new fiscal year, the upcoming budget is expected to tackle key challenges:

  1. Record Budget, Sluggish Revenue: Siddaramaiah aims to exceed Rs 4 lakh crore in outlay, but revenue collections are falling short of targets by about Rs 18,000 crore. While a target of Rs 4.1 lakh crore was initially set, sources suggest it might settle at Rs 4.05 lakh crore.
  2. High Committed Expenditure: Despite a record revenue collection of Rs 2.6 lakh crore, a significant portion will go towards salaries, pensions, and interest payments, leaving limited room for capital expenditure.
  3. Reducing Administrative Burden: The government’s increasing cabinet posts for Congress functionaries is raising administrative costs, emphasizing the need for more efficient spending.
  4. Clearing Pending Bills: The state owes contractors, electricity companies, and farmers significant dues, which need urgent attention.
  5. Boosting Non-Tax Revenue: With limited space to increase taxes, Siddaramaiah must look for ways to enhance non-tax revenue, which has remained stagnant at Rs 13,000 crore.
  6. Debt Management: Karnataka’s total debt exceeds Rs 6.6 lakh crore, with borrowing and debt servicing becoming an ongoing challenge.
  7. Fulfilling Election Promises: Key promises, like the reintroduction of the old pension scheme (OPS), need to be addressed promptly.
  8. Central Grants: With delays in local elections, Karnataka risks missing out on substantial central funds, requiring a diplomatic approach with the Centre.
  9. Bengaluru’s Development: Bengaluru’s infrastructure needs significant investment, though the fiscal constraints make meeting these demands challenging.
  10. Equitable Development: Siddaramaiah must balance urban and rural development, focusing on measures for the state beyond Bengaluru.

As Siddaramaiah navigates these multiple challenges, his budget could shape the state’s future political and economic landscape.