The Union Budget 2025-26 has allocated ₹41,000.07 crore for Jammu and Kashmir, a reduction from last year’s ₹42,277 crore. While the government has ensured continued central assistance, this cut in funding raises serious concerns about the future of critical infrastructure and development projects in the region.
Jammu and Kashmir is not just another Union Territory—it is a region that has faced decades of economic uncertainty, natural disasters, and security challenges. The expectation was that this Budget would introduce bold investments in hydroelectric power, flood recovery, and industrial revival. Instead, the reduced allocation signals a lack of urgency in addressing the region’s long-term economic stability.
The Budget completely ignores several key infrastructure projects, which, if left underfunded, will become stranded assets. The Jhelum – Tawi Flood Recovery Project, crucial for mitigating the impact of future disasters, has received no dedicated funds. If another flood devastates the valley, will the government take responsibility for its inaction? The hydroelectric power sector, which has the potential to turn J&K into an energy hub, has been sidelined. There is no special funding for the stalled Kiru (624 MW), Ratle (800 MW), and Kwar (540 MW) projects, despite their importance in creating jobs and generating clean electricity. These projects have been delayed for years due to financial bottlenecks, and this Budget does nothing to revive them.
Businesses and MSMEs in the region expected a revival package to support local industries, tourism, and manufacturing, but their hopes have been dashed. Without substantial financial assistance, industrial stagnation will continue, leading to higher unemployment and migration of skilled youth. The tourism sector, one of J&K’s strongest economic drivers, has also been left without the financial boost it desperately needs to recover fully.
While ₹40,619.30 crore in Central Assistance provides a lifeline, it is not a growth strategy. The government must realize that Jammu and Kashmir needs a development-focused budget, not just an administrative one. Emergency funding for flood mitigation must be allocated immediately, ensuring that critical projects like the Jhelum-Tawi Flood Recovery Initiative are not neglected. The stalled Kiru, Ratle, and Kwar hydroelectric projects must be revived, with the government providing interest-free loans and tax incentives to ensure timely completion.
The current budget provides only ₹101.77 crore for capital expenditure, which is grossly insufficient. A minimum of ₹1,000 crore should be allocated for roads, railways, and business parks to stimulate economic activity. A special economic package tailored to reviving industries, boosting MSMEs, and attracting private investment is essential for long-term growth.
The people of Jammu and Kashmir do not need political assurances—they need real investments that can transform the region’s economy. The central government must reconsider its allocation and immediately announce additional funds to ensure that key projects do not languish in bureaucratic delays. If not, this Budget will be remembered as an opportunity wasted—one that failed to give J&K the economic push it desperately needs. It is time for the government to step up, acknowledge these gaps, and correct them before it is too late. The future of Jammu and Kashmir’s economy, infrastructure, and job market depends on it
