Uttar Pradesh Budget 2023-24: Roadmap to a Trillion Dollar Economy
With the aim of making Uttar Pradesh a ‘self-reliant’ state and a $ 1-trillion economy by 2027, the Finance Minister of UP Shri Suresh Khanna presented an INR 6.9 lakh crore1 budget for the fiscal year 2023-24, the biggest budget in the history of the state. Uttar Pradesh is an emerging economic hotspot and has a contribution of ~8 percent2 to the national GDP. The Budget laid a significant focus on the empowerment of the youth, welfare schemes, and connectivity and infrastructure development. For the financial year 2023-24, the nominal rate of increase in GSDP is estimated at 19 percent.3
The Budget laid notable emphasis on the following sectors.
Startups: Uttar Pradesh is actively promoting a startup culture and empowering its youth to become self-reliant. A provision of INR 100 crore has been made for seed funds to promote incubators. Startups are encouraged in sectors of tourism, healthcare, education, agriculture, and energy. Currently, the state has 50 incubators and 7,200 startups4. INR 60 crore has been allocated for the Information Technology and Startups Policy for UP.
Infrastructure: For fiscal year (FY) 2023-24, INR 55,0005 crore has been allocated for a range of infrastructure projects including the construction of expressways, roads, and metros, to position Uttar Pradesh as one of the most well-connected states in the country. The allocations have been significant; INR 30,000 crore5 for the construction and maintenance of roads and bridges; INR 2,588 crore for the widening of state highways; INR 50 crore has been earmarked for the development of road projects near proposed industrial and logistics parks. State Government will invest INR 3,000 crore for Chief Minister's Urban Expansion and New City Promotion Scheme.
Metro/RRTS/Expressways: For the marquee projects of Kanpur Metro and Agra Metro, INR 585 crore and INR 465 crore have been allocated, respectively. Over INR 1,300 crore has been allocated for the upcoming Regional Rapid Transit System project in the Delhi-Ghaziabad-Meerut Corridor. A budgetary provision of INR 235 crore has been made in the initial phase of the new expressway projects of Jhansi and Chitrakoot.
Agriculture: Agriculture has always been an important pillar and focus policy area for Uttar Pradesh. In FY 22-23 budget, a 50 percent subsidy was provided on the electricity bills of private tubewell consumers. It has been raised to 100 percent in FY 23-24 budget, for which a provision of INR 1,500 crore has been made. The government has invested in promoting research and innovation to promote the startup culture in agriculture. INR 20 crore is proposed for the Agriculture Accelerator Fund for starting an agri-tech startup incubation center.
Tourism: Uttar Pradesh has vast opportunities for tourism. The state has seen a sustained rise in tourism activity. Uttar Pradesh saw a footfall of 24.87 crore6 tourists in 2022. Efforts are being made for beautification and tourism development in Ayodhya, Varanasi, and Prayagraj. The development of a Spiritual Circuit in Gorakhpur-Devipatan, Jewar-Dadri-Noida-Khurja, and Govardhan is proposed. First-of-its-kind night safari is set to come up in Kukrail in Lucknow with an outlay of INR 50 crore7. INR 1,000 crore8 have been earmarked for the project of 'Dharmarth Marg,’ concerning the development of roads linked to religious and spiritual tourist centres.
Renewable Energy: Electricity consumption is expected to rise in the state to 53,000 MW8 by 2028. Noida is envisaged as a “solar city” and Bundelkhand is to be transformed as a hub of green energy. The state government has announced Ayodhya as a Model Solar City and INR 15.75 crore9 has been allocated for the same.
UP's turnaround on ease of doing business has been phenomenal. The state marked a milestone by leapfrogging 12 positions in the States’ Ease of Doing Business Index reaching the second position in 2022.10 Uttar Pradesh, with its inherent strengths, young demographics and future growth potential is an attractive investment destination in India. Uttar Pradesh is currently home to ~17 percent of India’s population and houses the youngest workforce, with 56 percent of the total population in the working age group. UP is a vital cog in India’s determined march towards a $5 trillion economy and the UP Budget 2023-24 is a step to strengthen the state’s contribution towards this ambition.