- 200 units of free electricity for AAY households announced
- 10 kg additional ration per person for AAY beneficiaries from April 2025
- Pensions enhanced for over 10 lakh vulnerable persons in J&K
- Marriage Assistance for EWS girls increased from ₹50,000 to ₹75,000
- Free ridership for women in J&K on government-owned transport including e-buses from April 2025
- Stamp Duty exemption for property transfer within blood relations
Jammu: Chief Minister Omar Abdullah, who also holds the portfolio of Finance Minister, on Friday presented the first budget of the Union Territory with an outlay of Rs 1.12 lakh crore, and proposed a series of welfare and development initiatives for 2025-26, reflecting people’s aspirations.
He said J&K is at the threshold of a new era of peace and prosperity, with a semblance of normalcy returning after over three-and-a-half decades of turmoil.
Presenting the budget in the Legislative Assembly here, Abdullah praised Prime Minister Narendra Modi, Union Home Minister Amit Shah and Union Finance Minister Nirmala Sitaraman for their support in various sectors.
Abdullah started his over one-and-half-hour speech in English with the Persian couplet, “Tan Hama Daag Daag Shud – Punmba Kuja Kuja Neham…” (my entire body is covered with bruises where should I apply the balm), amid thumping of benches by his party legislators.
This is the first budget of the National Conference-led government after it came to power in October last year, ending six years of central rule.
The last budget session took place in 2018 under the then PDP-BJP government in the erstwhile state of J&K, which was accorded the status of Union Territory after Ladakh was carved out as a separate UT following the abrogation of Article 370 on August 5, 2019.
He said the improved environment is contributing to economic progress, with J&K’s economy expanding from Rs 1,64,103 crore in 2019-20 to Rs 2,45,022 crore in 2023-24.
“The total net budget estimates for fiscal 2025-26 are Rs 1,12,310 crore, excluding provisions for ways and means advances and overdrafts,” Abdullah said.
With a focus on a zero-deficit budget, he said: “The expected revenue receipts are Rs 97,982 crore and capital receipts are Rs 14,328 crore. Similarly, revenue expenditure is estimated to be Rs 79,703 crore and capital expenditure Rs 32,607 crore.”
Detailing the estimates, he said gross receipts are estimated at Rs 1,40,309.99 crore, including provisions for an overdraft of Rs 28,000 crore.
“Given these receipts, total gross expenditure is estimated to be Rs 1,40,309.99 crore,” he added.
Abdullah highlighted that the Union Territory’s own revenues, both tax and non-tax, are estimated at Rs 31,905 crore.
“Additionally, Rs 41,000 crore is expected as central assistance and Rs 13,522 crore as CSS and PMDP for the Union Territory of Jammu and Kashmir,” he added.
Revealing fiscal indicators, he projected the tax-GDP ratio at 7.5 percent for 2025-26.
The budget has estimated the fiscal deficit for 2025-26 to be at 3.0 percent of the Union Territory’s GDP.
“This is substantially lower than the 5.5 percent in 2024-25 (RE),” he added.
The GDP for 2025-26 is projected at Rs 2,884,22 crore, reflecting a growth of 9.5 percent over the previous year, he added.
The chief minister said the budget for J&K Police, which was around 11 percent of total allocation, has been migrated to the Ministry of Home Affairs’ budget from 2024-25 onward.
“In addition to this, J&K will receive an extra Rs 5,000 crore in grants for 2024-25 and 2025-26. I sincerely thank the prime minister, home minister, and finance minister for their unwavering support in strengthening J&K’s fiscal health and realising its vision for growth and prosperity,” he said.
The budget emphasises inclusive growth, fiscal prudence, and strategic investments in key sectors, including infrastructure, agriculture, industry, healthcare, education, digital governance, and tourism.
The budget also proposed to introduce a new hydropower policy to tap the UT’s full potential of 20,000 MW and attract private investment.
“We are focused on bridging regional disparities, empowering youth and women, and fostering a business-friendly environment to attract investment and innovation,” Abdullah, who also holds the finance portfolio, said while presenting his maiden budget in the assembly.
With an aim to unlock Jammu & Kashmir’s industrial potential, Abdullah announced a significant step towards establishing a leather tanning industry.
“Currently, around 5,000-6,000 pelts produced daily in Kashmir go to waste due to the absence of processing facilities. To harness this opportunity, the government will formulate a policy to promote leather tanning industries, ensuring value addition. Processing these skins into leather will contribute an additional Rs 100 crore to J&K’s economy,” he said.
Emphasising the importance of a resilient rural economy, Abdullah announced the launch of the “J&K Green Mission” in 2025.
“We will unite communities to make villages clean and green through waste segregation, proper disposal, and vermicomposting,” he said.
To ensure sustainability, the government will implement the Own Source Revenue (OSR) policy to make every village panchayat self-sufficient over the next five years.
Additionally, under the Pradhan Mantri Awas Yojana – Gramin, 3.40 lakh houses have been sanctioned, with 50,000 more to be built in 2025-26, he said.
Buoyed by the tourism sector’s record-breaking show in 2024, with 2.36 crore tourist footfalls, Abdullah announced a strategic expansion plan under the SPREAD (Sustainable Promotion of Emerging Alternate Destinations) initiative.
“This initiative will help develop world-class alternative destinations across J&K, reducing pressure on heavily visited locations. With the central government’s support, we are already in the planning phase,” he said.
He also announced an eco-tourism policy that will ensure sustainable tourism while tackling waste management challenges, particularly plastic waste at tourist sites.
A multi-stakeholder advisory committee to address issues in the tourism and hospitality sector will be set up too, he said, adding that Gulmarg Gondola attracted 7.68 lakh visitors in 2024, and the Kashmir Marathon saw 1,800 global participants.
“Tourism’s contribution to GSDP will be increased from 7 percent to 15 percent in the next 4-5 years,” he added.
In order to bolster J&K’s startup ecosystem, the government has also allocated Rs 50 crore for providing financial aid, mentorship and incubation for entrepreneurs.
“This will foster innovation, empower startups, and position Jammu and Kashmir as a dynamic hub for entrepreneurship,” Abdullah said.
For MSMEs (micro, small and medium enterprises), he announced a new policy to provide price preference to local small businesses in public procurement, addressing concerns regarding the central government’s online marketplace GeM.
To combat illegal mining, he said that a mining surveillance system using satellite imagery will be implemented in collaboration with BISAG. Additionally, handheld e-challan devices will be introduced for enforcement, he noted.
Abdullah also unveiled the SEHAT App, saying this is set to revolutionise healthcare in J&K.
“This app will offer teleconsultation services, online doctor appointments in government hospitals, and a digital health records system integrated with AB-PMJAY-SEHAT insurance,” he said.
The chief minister also added that the app will include AI-powered diagnostics, e-prescriptions, medicine delivery, and emergency health support. “Ambulance services and real-time updates on preventive care, vaccinations, and wellness programmes will also be provided.”
On the education sector, he said the government will upgrade 40 higher secondary schools — one boys’ and one girls’ school per district — into integrated K-12 institutions.
“We are committed to transforming J&K into an educational hub by fully implementing NEP 2020 and launching four-year undergraduate programmes in all colleges,” Abdullah said.
He also announced 600 additional seats in polytechnic colleges.
The government will encourage private universities to set up satellite campuses in J&K, he added.
To transform J&K into a hub of sporting excellence, the budget has envisaged setting up of national centres of excellence for water sports at Dal Lake (Srinagar) and Basohli (Jammu) and a gymnastics academy at Gindun Rajbagh and Khel Gaon, Nagrota.
The FY26 budget has proposed four state-of-the-art cricket academies with an allocation of Rs 8 crore, youth hostels in Jammu & Kashmir divisions with an outlay of Rs 10 crore, apart from the development of 247 playfields, stadiums, and sports courts.
The government aims to engage “75 lakh youths in sports activities across J&K, fostering a culture of fitness and excellence”, he added.
The government has plans to establish the Jammu & Kashmir Skill and Entrepreneurship University (J&K SEU), he noted.
“This university will offer cutting-edge training in technology, healthcare, tourism, renewable energy, and traditional crafts while fostering innovation and industry partnerships,” Abdullah said.
Sectoral Allocations and Development Initiatives
- Agriculture & Allied Sectors: ₹2,221.58 crore allocated, an increase of ₹332.72 crore from the revised 2024-25 allocation.
- Rural Development: ₹3,773.93 crore allocated, an increase of ₹990.04 crore from the revised 2024-25 allocation.
- Tourism: ₹390.20 crore allocated, an increase of ₹121.77 crore.
- Industries: ₹602.85 crore allocated, an increase of ₹291.44 crore.
- Health & Medical Sector: ₹1,750.50 crore allocated, an increase of ₹643.71 crore. The SEHAT App will soon be launched to improve healthcare accessibility.
- Education Sector: ₹1,388.97 crore allocated, an increase of ₹242.75 crore.
- Sports Sector: ₹152.69 crore allocated, an increase of ₹36.91 crore.
- Roads & Bridges: ₹4,062.93 crore allocated, an increase of ₹439.28 crore.
- Irrigation & Water Supply: ₹2,662.71 crore allocated, an increase of ₹817.87 crore.
- Housing & Urban Development: ₹2,761.74 crore allocated, an increase of ₹823.53 crore.
J&K govt to introduce new hydropower policy to attract private investment: CM
Rs 15 cr proposed for glacial lake outburst flood risk monitoring
The Jammu and Kashmir government will introduce a new hydropower policy to tap its full potential of 20,000 MW and attract private investment, Chief Minister Omar Abdullah said on Friday.
Presenting his maiden budget in the Legislative Assembly here, he said the government is also reforming metering, billing, and collection to strengthen the power sector in the Union Territory.
“To unlock J&K’s full hydropower potential, my government will introduce a new hydropower policy to accelerate development, attract private investment, and drive sustainable energy growth,” Abdullah said.
The chief minister proposed an allocation of about Rs 2,021.37 crore for the power sector in 2025-26 against Rs 762.80 crore 2024-25.
The power sector is a top priority for his government, as it is the backbone of a thriving economy, he said.
“Our vision is two-fold: first, to make J&K an energy hub, achieving self-sufficiency and becoming a net power exporter by harnessing its vast hydro potential; and second, to ensure 24/7 reliable and affordable electricity for all households by 2027-28.
“To achieve this, we are implementing a well-coordinated plan, covering all key aspects of the power supply chain,” he said.
J&K has a hydro potential of 20,000 MW, but only 3,400 MW has been harnessed, he noted.
To fast-track development, Pakal Dul, Kiru, Kwar, and Ratle will add over 3,000 MW by 2027, while new projects like Kirthai-I, Dulhasti-II, Bursar, Sawalkote, Uri-I Stage-II, Ujh, and Kirthai-II will add 4,500 MW within a decade, ensuring energy self-sufficiency and making J&K a power exporter, the chief minister said.
Under-recovery has dropped from Rs 6,552 crore in 2022-23 to Rs 5,244 crore in 2023-24, with a target of Rs 4,200 crore in 2024-25, he said, adding that expanding the consumer base, smart meters, online billing, and aerial bunched cables are driving this turnaround.
He said high AT&C losses resulted in huge outstanding liabilities for power purchase, for which Rs 28,000 crore were borrowed in the last few years, raising public debt from 48 percent of GSDP in FY 2015-16 to 52 percent in 2023-24.
“To mitigate this, we are reducing high-cost debt, optimising liabilities, and calibrating the repayment schedules for long-term fiscal stability,” he said.
The chief minister said the Centre has sanctioned Rs 5,620 crore under the Revamped Distribution Sector Scheme (RDSS) to enhance the power distribution infrastructure and ensure a reliable, efficient, and financially sustainable power supply.
Under this scheme, J&K has submitted an ambitious investment plan of Rs 12,922 crore, focusing on smart metering, loss reduction, and modernisation of the distribution network in rural and urban areas, he noted.
Abdullah said the phase-I of the scheme is currently under execution and over 40 percent progress has already been made in loss reduction works, and the projects are on track for completion by 2026, with more than 40,000 smart meters installed so far.
Emphasis has been placed on enhancing the aesthetic appeal of Jammu and Srinagar by converting overhead electrical networks into underground cabling along major roads, he added.
The government is also promoting rooftop solar installations under the PM Surya GharMuft Bijli Yojana, while solarisation of 22,494 government buildings with a total capacity of 314 MW is set to be completed by December this year, the chief minister said.
Highlighting a key challenge, he said there is a gap between the cost of power supply and revenue collection.
“While the average cost per unit is Rs 7, we recover only Rs 2.5 due to systemic inefficiencies, high losses, and low tariffs. To bridge this gap, our government is implementing 100 per cent smart metering, strengthening billing and collection mechanisms, and modernising the entire distribution network,” Abdullah said.
The goal is to bring down Aggregate Technical and Commercial (AT&C) losses from 41 percent to 25 percent by 2025-26, ensuring a financially sustainable power sector, Abdullah added.
He also proposed instituting the Chief Minister’s Award to recognise and reward exemplary efforts by field functionaries in reducing AT&C losses and conducting energy audits.
Describing the safety and well-being of the power sector workforce as paramount, he said his government would build dedicated linemen huts and essential facilities to support thousands of linemen and field staff who work tirelessly, often risking their lives, in extreme conditions.
“We will also prioritise capacity building and enhanced insurance coverage to ensure their safety and well-being as they perform critical power sector duties.”
Additionally, he said a fully equipped Power Training Institute will be established to provide continuous skill development and professional growth.
Abdullah proposed an allocation of Rs 15 crore for monitoring glacial lake outburst flood risk, setting up early warning systems and mitigation strategies.
“Our government is taking proactive measures to protect vulnerable communities and infrastructure from GLOFs and landslides. I propose an allocation of Rs 15 crore for GLOF risk monitoring, early warning systems, and mitigation strategies,” the chief minister said.
Additionally, under the National Landslide Risk Mitigation Programme (NLRMP), Rs 15 crore is earmarked for risk assessment, monitoring and engineering solutions to stabilise landslide-prone areas, he said. “These initiatives will enhance disaster preparedness and build a climate-resilient Jammu and Kashmir.”
The chief minister said the 2014 floods in the Kashmir valley highlighted the need for proactive disaster mitigation.
“To enhance resilience, our government is establishing a Rs 39-crore Disaster Mitigation Fund, the first dedicated fund for prevention, early warning systems, and preparedness.
“By investing in tools, manpower, and infrastructure, we aim to reduce risks and safeguard lives and property across Jammu and Kashmir,” he said.
The chief minister also said his government remains committed to ensuring a smooth and secure annual pilgrimage to the 3,880-meter-high cave shrine of Amarnath, scheduled to commence on July 3 this year.
“With seamless coordination between various government agencies and stakeholders, we will enhance pilgrim facilities, improve safety measures, and ensure the efficient conduct of this sacred journey,” he said.
Recognising the pilgrimage’s significant economic impact on the region, he said, “We are dedicated to supporting local businesses, boosting tourism and creating livelihood opportunities while upholding the spiritual and cultural essence of this revered pilgrimage.”
