‎‎New Delhi, Feb 11 (.) ‎In a combative and data-heavy reply to the union Budget debate in the Lok Sabha, Finance Minister Nirmala Sitharaman on Wednesday firmly rejected Opposition claims that certain states had been denied funds or key infrastructure projects, including the allegation that Uttar Pradesh had been denied a bullet train corridor.
‎Leading with a strong defence of the Centre’s fiscal record, Sitharaman declared that gross tax receipts for 2026–27 are pegged at Rs 44.04 lakh crore, marking an 8 per cent rise over the Revised Estimates (RE) of 2025–26 — an increase of Rs 3.26 lakh crore. ‎
“This reflects both the resilience of the Indian economy and improved compliance,” she said, as treasury benches thumped desks in approval. ‎“We have transferred 41 per cent — No State’s share reduced”.
Responding sharply to allegations that the Centre had diluted tax devolution or favoured certain states politically, Sitharaman asserted that the government had adhered to the Finance Commission’s formula. ‎
“We have transferred 41 per cent of the divisible pool to the states. No state’s share has been reduced,” she said. “You cannot go both ways.” ‎
Clarifying the technicalities, she explained that the 41 per cent share applies to the divisible pool of taxes — the net proceeds — and not to gross tax revenue, which includes constitutionally permitted surcharges and cesses. ‎
Citing the 16th Finance Commission report tabled in Parliament, she said the Commission had reviewed transfers from 2018-19 to 2022-23 and concluded that the Centre’s devolution matched its recommendations each year.
‎“Itna paisa states ko jayega,” she remarked, underlining that Rs 25.44 lakh crore is estimated to be transferred to states in 2026–27 through tax devolution and centrally sponsored schemes — Rs 2.70 lakh crore more than the current year’s revised estimate. ‎
On criticism regarding cesses, she maintained that earmarked collections for sectors such as education, health, and infrastructure ultimately benefit states. She directed members to Annex 4A and 4B of the Budget receipt documents, audited by the Comptroller and Auditor General, for detailed allocations. ‎
Amid pointed interventions from Opposition benches, including members from West Bengal who alleged political discrimination in fund allocation, Sitharaman dismissed the charge. ‎“There is no discrimination against any state, including West Bengal,” she said. “Transfers are formula-driven and based strictly on Finance Commission recommendations.”
‎She maintained that the Centre remains open to working with all states, regardless of political affiliation, to ensure implementation of centrally sponsored schemes and infrastructure projects. ‎Her remarks came in the backdrop of Opposition leaders alleging that certain Opposition-ruled states were not adequately supported in the Budget. ‎
The Finance Minister also rejected the claim that Uttar Pradesh had been denied a bullet train project, calling the allegation misleading. ‎“Major infrastructure projects are guided by feasibility, planning stages and technical considerations, not politics,” she said, adding that capital investments are being made across states to build long-term assets. ‎
Sitharaman underlined the government’s continued focus on infrastructure-led growth. While the headline capital expenditure for 2026–27 stands at Rs 12.22 lakh crore — 3.1 per cent of GDP and 11.5 per cent higher than last year’s revised estimate — she emphasised that the effective capital expenditure, including grants to states for asset creation, totals Rs 17.1 lakh crore, or 4.4 per cent of GDP. ‎
“This Rs 17.1 lakh crore is being spent to build assets across states and union Territories,” she said. ‎She further informed that total expenditure for 2026–27 is estimated at Rs 53.47 lakh crore. ‎
Addressing concerns about industry stress, Sitharaman insisted that credit flow remains robust. ‎“Credit kahin kam nahin” (There is no shortage of lending). ‎
Total credit expanded 13.8 per cent in the current financial year. As of January 15, 2026, non-food bank credit grew 13 per cent, while NBFC credit rose 15.4 per cent, she said. ‎
She also highlighted that the definition of MSMEs had been expanded in the previous Budget to prevent firms from losing benefits upon crossing turnover thresholds. In the current Budget, additional support has been announced for medium-sized firms with export potential to help them emerge as “sectoral champions.”
‎Outlining sectoral priorities, Sitharaman said bio-pharma had received key focus in the 2026–27 Budget. She reiterated emphasis on animal husbandry, farming and fisheries, positioning the Budget as rural and agriculture-oriented. ‎
The government plans to integrate skilling into formal education and set up mega entrepreneurship hubs near industrial clusters, enabling students to graduate as “job creators.” ‎
In a bid to promote medical tourism, she announced that five regional medical hubs would be established across the country. ‎
The debate was not without sharp political exchanges. Earlier, Congress leader Rahul Gandhi accused the government of “selling the nation” through the India-US trade deal, intensifying partisan tensions in the House. ‎
But Sitharaman remained focused on fiscal metrics, repeatedly returning to the theme of rule-based devolution and capital-led growth. ‎
Finance Minister’s message was clear: the Budget, she insisted, spreads resources across states without discrimination, strengthens infrastructure through record capital spending, and aims to position India’s economy for sustained growth — with, in her words, “no state shortchanged and no credit crunch anywhere.” . SKA KK