Karnataka's Rs 4.48 Lakh Crore Budget Bets Big on AI and Infrastructure

The total outlay of the Karnataka State Budget has been pegged at Rs 4,48,004 crore, with a focus on technology-driven growth, infrastructure development, and environmental sustainability.

Presenting the Budget, Siddaramaiah said that Karnataka plays a distinctive role in national and international trade, and rapid developments in Artificial Intelligence (AI) are transforming global production systems. He emphasised that innovations in science and technology are increasingly shaping the trajectory of the state. In this context, he said the Budget has been presented with responsibility and foresight to move forward with the resolve to "turn fire into light."

The Chief Minister also highlighted the impact of GST rate rationalisation carried out in September 2025. He said the changes have reduced the state's GST collections. Before the rationalisation, Karnataka's average monthly GST revenue growth in 2025-26 was around 10 per cent (net of refunds). However, after the implementation of the revised rates, the average monthly growth has moderated sharply to around 4 per cent. The restructuring is expected to reduce overall GST collections by approximately Rs 10,000 crore in the current financial year and Rs 15,000 crore in the next year.

Among the major announcements, Siddaramaiah said that with the objective of establishing a state-of-the-art AI Centre of Excellence in Bengaluru, two centres will be set up in collaboration with the Institute of Bioinformatics and Applied Biotechnology, the Centre for Cellular and Molecular Platforms and NASSCOM at a total cost of Rs 16 crore.

He also announced that a Leopard Rehabilitation Centre will be established in Bannerghatta Biological Park to rehabilitate leopards captured from residential areas on the outskirts of Bengaluru, at an estimated cost of Rs 5 crore.

Under the Karnataka Water Security and Resilience Programme (KWSRP), a World Bank-funded initiative, disaster management projects will be undertaken over five years for Rs 5,000 crore to address flooding in Bengaluru.

Siddaramaiah further announced that, in accordance with revised transfer rules of the Excise Department, transfers of Group-C cadre officers including Excise Inspectors, Excise Sub-Inspectors, and Excise Head Constables/Constables, have been carried out through digital counselling to enhance transparency. The government will also extend digital counselling for transfers of Excise Deputy Superintendents and Excise Superintendents.

- ANI