This budgetary allocation reflects the central government’s ongoing commitment to the development and modernization of Jammu and Kashmir, focusing on infrastructure, security, and economic growth.
Israar Shahid
Any significant announcement made in Parliament by the Hon’ble Finance Minister of the country is always eagerly awaited nationwide. The Union Budget, in particular, holds immense importance for every citizen, as it outlines the financial roadmap for the coming year. Given the unique history and geopolitical significance of Jammu and Kashmir, it has always remained a key focus area in New Delhi’s policymaking.So, when the national budget for the financial year 2025-26 was presented by Her Excellency Nirmala Sitharaman, the Hon’ble Finance Minister of India, political commentators in J&K keenly tuned in—not just to understand the broader economic outlook but more importantly, to see what it held for our Union Territory. As someone who closely observes Kashmir’s political and economic landscape, I, too, was eager to analyse the budget’s implications for the region.After thoroughly reviewing the official budget document and listening to expert analyses from renowned YouTubers and economists, I decided to highlight the key takeaways, with a special focus on Jammu and Kashmir. Additionally, I spoke to individuals from Kashmir with backgrounds in economics, as well as some UPSC aspirants, to gather their insights and reactions, which I will incorporate toward the end of this article.
Before diving into what the budget holds for J&K, let’s first look at some key highlights of the Union Budget 2025 that were announced on the floor of the house. Budget speeches often follow a familiar script, but this year felt different. If we had to sum up this budget in one word, it would be pivot.India, despite facing global headwinds, remains the world’s fastest-growing major economy. However, challenges persist—rising inflation, a jobs crisis, shrinking investment avenues, and shifting trade dynamics among major powers. The possible return of Donald Trump to the U.S. further adds to global uncertainty. Given these challenges, how can India sustain its growth momentum?The government appears to be restructuring its priorities to revive growth. Unlike previous years, there are fewer mega projects or big-ticket initiatives. Instead, the focus has shifted towards the common man and the middle class. This is a “back-to-the-basics” budget—driven by a new philosophy and fresh priorities.In the next section, I will outline the key highlights of the budget and provide a special reference to Jammu and Kashmir.
The Union Budget for 2025-26 has allocated ₹41,000.07 crore to Jammu and Kashmir (J&K), maintaining the same level of central assistance as the previous fiscal year. This allocation includes ₹40,619.30 crore designated as central assistance to bridge the resource gap faced by the Union Territory. In addition to this, the Railway Budget has earmarked ₹844 crore for railway projects in J&K. Notably, four major railway stations—Budgam, Jammu Tawi, Katra, and Udhampur—are set to be developed as ‘Amrit Stations’ with a total investment of ₹292.5 crore, aiming to enhance passenger amenities and station infrastructure. The J&K Police, under the administrative control of the Union Home Ministry, has been allocated ₹9,325.73 crore in this budget.JKP has always been at the forefront of curbing terrorism in J&K, and providing them with a well-structured budget will indeed help in achieving a terrorism-free J&K.This budgetary allocation reflects the central government’s ongoing commitment to the development and modernization of Jammu and Kashmir, focusing on infrastructure, security, and economic growth.
- Tax Break for the Middle Class :The biggest highlight of this budget is the tax break for the middle class. If you earn less than ₹12 lakh annually, you will now pay zero income tax. Previously, the threshold stood at ₹7 lakh, making this a significant relief for millions across the country. For the people of J&K, this announcement brings more than just financial relief—it symbolizes hope. Given the region’s turbulent past, many businesses suffered due to prolonged uncertainty. This tax relaxation could provide a much-needed push for those trying to rebuild their financial stability. Although extreme poverty is not as prevalent in J&K, a considerable section still falls under the Below Poverty Line (BPL) category. The revision in tax slabs is, therefore, being widely celebrated, not just nationwide but also within J&K, as it directly impacts small business owners, self-employed individuals, and salaried professionals.
- Accelerating Agriculture:Agriculture and horticulture form the backbone of J&K’s economy, making this year’s Union Budget a ray of hope for farmers across the region. With Prime Minister Dhan-Dhaanya Krishi Yojana, the government aims to cover 100 districts with low productivity, benefiting 1.7 crore farmers nationwide. For Kashmir, where thousands of farmers have already benefited from the Kisan Credit Card (KCC) scheme, this budget brings a significant upgrade. One of the biggest challenges farmers faced was the ₹3 lakh cap on KCC loans, which often fell short of their actual needs. Now, with the KCC loan limit enhanced to ₹5 lakh, farmers in J&K can access better credit facilities to expand and modernize their agricultural practice. Additionally, short-term loans under KCC will now benefit 7.7 crore farmers, including fishermen and dairy farmers. This financial boost will particularly help Kashmir’s apple growers, saffron cultivators, and dairy farmers, who are the pillars of the local economy.
- Boosting Healthcare: In recent years, cancer has become alarmingly common in Jammu and Kashmir, posing a significant challenge to both patients and healthcare providers. While the Ayushman Bharat scheme has provided financial support, access to specialized treatment remains limited. Recognizing this issue, the new Union Budget has announced the establishment of Cancer Care Centres in all district hospitals within the next five years—a major step toward improving cancer treatment in J&K. Additionally, the budget includes provisions for reducing the costs of 36 life-saving medicines, making essential treatments more affordable. Another noteworthy reform is the health cover for over 1 crore gig workers, ensuring a wider safety net for informal sector workers. These measures collectively aim to strengthen J&K’s healthcare infrastructure and make quality medical care more accessible to its people.
While the budget announcements set a promising tone, I wanted to hear firsthand how experts and those directly impacted perceive these changes. So, I reached out to a few individuals from the fields of economics, and businessto understand their take on the allocations for Jammu and Kashmir. Here’s what they had to say:”
“This budget strengthens financial transparency and tax compliance. The tax relief for the middle class is a big step, but from an accounting perspective, I am keen on the changes in GST and digital taxation, which will make compliance smoother for businesses. Also, incentives for startups and MSMEs can boost economic growth in J&K, provided they are implemented effectively” said Babar Lateef, a Chartered Accountant student.
Firdous Javid, an entrepreneur shared his insights and said, “The Union Budget 2025 has delivered a decisive push to startups emphasizing innovation through technology and improved access to capital and investments. The announcement of a new Fund of Funds with an expanded scope and a fresh contribution of ₹10,000 crore is a significant step towards fostering entrepreneurship. Additionally, the proposed establishment of an Artificial Intelligence (AI) centre and measures to boost global capability centres reflect the government’s commitment to nurturing technological advancements. These initiatives are poised to create a more conducive environment for startups, encouraging innovation and growth in the sector.”
Irtiqa Lone, a UPSC aspirant said, “The budget this year has been a strategic shift, focusing on long-term economic stability while ensuring social welfare. From a policymaking and governance perspective, the emphasis on employment generation, tax relief for the middle class, and sectoral allocations reflects a balanced approach. For aspirants like us, the budget serves as a crucial document to analyse economic trends, fiscal policies, and the government’s vision. The increased allocation for education, digital infrastructure, and skill development initiatives is particularly noteworthy, as it aligns with India’s evolving job market. Additionally, the focus on e-governance and direct benefit transfers (DBT) highlights the commitment to transparency and accountability in administration.”
Conclusion
The official budget document itself is extensive, and covering every detail would be an endless task. However, what stands out in the Union Budget 2025 is its people-centric approach, particularly benefiting the middle class. I firmly believe that with each passing year, we are moving closer to the vision of Atmanirbhar Bharat, and soon, we will achieve it. For J&K, two key areas—agriculture and startups—emerge as prime beneficiaries of this budget, paving the way for economic growth and self-reliance. As we embrace these opportunities, I hope we continue progressing and contributing towards Viksit Bharat.
The Writer is a student activist and can be reached at [email protected]
