Budget 2026 showers Uttar Pradesh with a bagful of goodies
Sitharaman's presentation targets 25 cities in Uttar Pradesh for urban push while Varanasi gains ship-repair port and two high-speed rail corridors
While the country remained glued to the Lok Sabha on Sunday (February 1), hearing what Union Finance Minister Nirmala Sitharaman would unveil under her ninth straight Budget, one state that stood to gain much is Uttar Pradesh. She came up with gifts for Varanasi, the constituency of Prime Minister Narendra Modi, to accelerate the development of the state’s Purvanchal region.
Also, through laying out a plan for a major infrastructure push targeting cities with more than five lakh people, Sitharaman aimed to benefit the state by bringing 25 of its cities under the purview of the urban push.
Rail corridors, handlooms
Although the northern state, which is a political prize for the parties, is not among those that are immediately heading to elections, it remained a recipient of several benefits under the latest Budget. Among them are proposals for high-speed rail corridors to the development of handlooms, which will benefit the existing One District One Product (ODOP) scheme in UP.
The Budget has put special attention on Varanasi, the constituency of Modi. In her presentation, Sitharaman announced the setting up of a ship-repair port in the city. Additionally, UP will have two high-speed rail corridors spanning 1,500 kilometres to improve regional connectivity and logistics, and both will run through Varanasi.
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The first will connect the holy city with the national capital, New Delhi, while the second will be between Varanasi and Siliguri in northern West Bengal. Both the ports and the corridors will have major benefits in terms of employment and connectivity, and could prove to be electorally productive for the state’s ruling Bharatiya Janata Party in next year’s Assembly polls.
Urban push
As the Union finance minister announced that special resources would be utilised for developing cities in the country with a population of more than five lakh, UP is set to be a major beneficiary of the plan. Announcements have been made to upgrade infrastructure in Tier-2 and Tier-3 cities with an investment of more than Rs 12 lakh crore.
Union Budget 2026 and Uttar Pradesh
- The Budget packs big projects for rail, cities, industry, health and tourism across the state
- Varanasi to get a ship-repair port and sit on two new high-speed rail corridors.
- Twenty-five UP cities with over five lakh people will get major infrastructure upgrades.
- The Mahatma Gandhi Handloom Scheme will strengthen the ODOP push and support artisans.
- Steps to make leather goods cheaper will boost hubs like Kanpur and Agra.
- Meerut’s sports goods industry will benefit from a new push for manufacturing.
- Girls’ hospitals in every district and a 50 percent capacity rise in district hospitals are planned.
UP, which is India’s most populated state, has 25 cities that are home to more than five lakh people. They include, besides the capital Lucknow, Kanpur, Noida, Ghaziabad, Varanasi, Gorakhpur, Prayagraj, Saharanpur, Moradabad, Aligarh, and Ayodhya. An improvement in their infrastructure is expected to give those areas a significant boost.
This year's budget announced the launch of the Mahatma Gandhi Handloom Scheme to promote handloom products. The One District One Product (ODOP) scheme, launched by the government of Uttar Pradesh in 2018, has given a boost to the businesses of products from every district of the state. This includes handloom products in several districts.
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With the central government's announcement of the new scheme, the already-running ODOP scheme in Uttar Pradesh is also expected to benefit. Industrialist and commerce expert Rajat Mohan Pathak told The Federal, “The special focus on infrastructure boost in cities with a population of over five lakh and on the textile sector in this Budget shows that it is focused on empowering small businesses and artisans rather than large industrial groups. Textile parks in traditional textile centres such as Varanasi, and these policy announcements can create a multiplier effect."
While the Centre had already announced ahead of the Budget that the semiconductor sector would receive a focus, Sitharaman announced India Semiconductor Mission 2.0. A semiconductor park is already being built in Uttar Pradesh. After the Union finance minister’s announcement, places such as Noida will also benefit, and new employment opportunities will be created.
Leather industry to gain
The latest Budget has also mentioned making leather goods cheaper. Two major industrial cities of Uttar Pradesh — Kanpur and Agra — are known for their leather industries, from where products are supplied not only to domestic markets but also abroad. The announcement will benefit these industrial centres.
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The central government has also adopted a policy to accelerate the manufacturing of sports goods, and it will help UP’s Meerut, which is home to a thriving sports goods manufacturing industry.
Education and health
This year’s Budget has also made social contributions, such as setting up girls’ hospitals in every district to support women’s education, safety, and access to higher education. This would mean they would come up in all 75 districts of UP. It has also been announced that the capacity of district hospitals will be increased by 50 per cent, which will again benefit those in UP. The state, therefore, will gain in sectors such as health and education.
(The article was first published in The Federal Desh)
