Financial Pledges and Future Prospects: Sitharaman's Assurance to States

Union Finance Minister Nirmala Sitharaman reaffirmed on Wednesday that 41% of taxes are allocated to states, stating confidently, "We have transferred 41% of the divisible pool to the states. No state's share has been reduced." She further noted that the state's share would rise to Rs 25.44 lakh crore in the coming year, marking an increase of Rs 2.7 lakh crore from the previous year while addressing the Lok Sabha's debate on the Union Budget 2026-27.

Sitharaman referenced the 16th Finance Commission's analysis of fund devolution from 2018 to 2023, confirming the Centre's compliance with the Commission's recommendations each year. "The 16th Finance Commission's analysis shows that the states' share transferred by the Centre met the recommendations annually from 2018 to 2023," she asserted.

Acknowledging state Finance Ministers' suggestions, Sitharaman announced an increase in 50-year capital expenditure loans to Rs 2 lakh crore for Special Assistance to States for Capital Investment. With the Centre's capital expenditure pegged at Rs 12 lakh crore, and states and UTs included, it climbs to Rs 17.1 lakh crore. She emphasized ongoing collaboration for Mega textile Parks to embrace 'new age' industrial textiles.

Addressing the credit landscape, Sitharaman stated robust lending, including for SMEs, highlighting a 13.8% credit expansion this financial year. Non-food bank credit grew by 13%, and NBFC credit increased by 15.4% as of January 15, 2026. Discussing employment, Sitharaman announced the establishment of five regional medical hubs, expected to generate significant job opportunities. Simultaneously, plans for five Textile-to-Leather Parks aim to bolster employment further. A senior care ecosystem training 1.5 lakh caregivers will also launch this year.