Union Budget 2026 Wishlist: Jharkhand Wants Centre to Release Pending Funds

Jharkhand’s Drinking Water and Sanitation Minister has demanded the release of pending funds from the Central Government. At a national departmental seminar held in New Delhi on January 27, Yogendra Prasad renewed Jharkhand’s demand for the Rs 6,270 crore pending under the state’s tap water (Nal-Jal) scheme. The minister said that due to the lack of funds, the scheme is on the verge of being shut down in the state.

He warned that in several districts, work related to household tap water connections has come to a standstill, and payments to contractors remain unpaid. According to the state government, if Central assistance is not released soon, the drinking water crisis in rural areas could worsen significantly, undermining the very objective of the scheme.

Earlier, Jharkhand’s Rural Development Minister Deepika Pandey met Union Minister for Panchayati Raj Lalan Singh, in New Delhi and urged him to release the Rs 2,736 crore pending under grants recommended by the Fifteenth Finance Commission.

Over the past year, Jharkhand’s ministers have made several such visits to Delhi and written dozens of letters seeking the release of pending dues. The Jharkhand government alleges that the Centre has withheld funds due to the state under multiple schemes.

Apart from the amounts already mentioned, media reports suggest that nearly Rs 1,600 crore allocated to Jharkhand under the Fifteenth Finance Commission recommendations has also been withheld. Additionally, funds meant for urban development—amounting to over Rs 2,100 crore—have not been released for the last three years.

Against this backdrop, what does the Jharkhand government expect from the Union Budget to be presented on February 1? 

Speaking to Outlook, Rameshwar Oraon, who served as Finance Minister in Hemant Soren’s previous government, said, “Jharkhand is a backward state and ideally deserves a special package. However, I do not think such a package will be announced. That said, we hope the Budget will make major provisions for irrigation, keeping farmers’ interests in mind. Agriculture can be a significant source of employment generation in Jharkhand. There should also be budgetary provisions for transport infrastructure, especially passenger trains. Freight trains already operate extensively here to carry minerals from mines.”

 Ahead of the Budget, a meeting of finance ministers from all states was held in New Delhi on January 10 with Union Finance Minister Nirmala Sitharaman. During the discussions, Jharkhand Finance Minister Radhakrishna Kishore demanded special economic assistance for the state.

He proposed that, on the lines of women-centric schemes in Bihar, women in Jharkhand should receive financial assistance of Rs 10,000 each to promote women entrepreneurship. Under the Chief Minister’s Women Employment Scheme, he sought Central support to link women with cottage and small-scale industries.

In addition, the Finance Minister requested Central assistance for installing PET-CT scan machines for cancer patients, Rs 2,000 crore for irrigation across one lakh hectares of farmland, priority allocation to railway projects in Jharkhand, compensation of Rs 4,000 crore for losses incurred under the Goods and Services Tax (GST) regime, expansion of the Pradhan Mantri Gram Sadak Yojana (PMGSY) for rural roads, and additional Central aid to raise per capita income in the state.

Other demands included simplifying the forest land acquisition process, Rs 31,380 crore for constructing new National Highways, a special package to develop tourist destinations as eco-tourism hubs, and raising the GST compensation rate to 4 per cent.

The Finance Minister also reiterated Jharkhand’s long-standing claim that the Centre owes the state Rs 1.36 lakh crore. According to the state government, this amount represents cumulative dues from Public Sector Undertakings (PSUs) under various heads over several years, including coal royalty, District Mineral Foundation (DMF) contributions, National Mineral Exploration Trust (NMET) dues, and compensation for land acquisition.

Of the total Rs 1.36 lakh crore, Rs 1,01,142 crore is claimed as land compensation, Rs 32,000 crore under the Common Cause framework, and Rs 2,500 crore as coal royalty. The state government has been exerting sustained pressure on the Centre for recovery of these dues and has even indicated the possibility of legal action.

Is there any likelihood that the Union Budget will make an announcement addressing these pending dues? 

Former Finance Minister Rameshwar Oraon believes otherwise. He said, “When I was Finance Minister, I never made special demands for Jharkhand. Our sole demand was the clearance of around Rs 1.32 lakh crore in pending dues. This is a genuine demand, largely related to land compensation. The Central Government acquired land in Jharkhand for mining, whether private or government land. Compensation was paid to private landowners, but not to the state government for its land. If the Centre clears these dues, Jharkhand would not need any special package.”

According to Oraon, it is unlikely that the Budget will include any announcement regarding these dues, given the enormous amount involved. Meanwhile, leaders of the ruling alliance continue to accuse the Centre of adopting a discriminatory approach by withholding Jharkhand’s rightful share.

When Union Minister Ramdas Athawale was questioned on this issue during his recent visit to Ranchi, he urged Chief Minister Hemant Soren to join the National Democratic Alliance (NDA). Athawale reportedly said that if Hemant Soren joins the NDA, Jharkhand would not face any shortage of funds and all pending releases would be cleared.

Responding to allegations of fund withholding and questions around the Union Budget, Bharatiya Janata Party leader and former minister Neelkanth Singh Munda told Outlook,

“First, the state government should clearly specify which department and which head of account has how much pending with the Centre. Second, it must submit utilisation certificates showing how much of the funds allocated annually by the Centre have actually been spent. If utilisation certificates are not submitted, funds will obviously be withheld.”

 On whether Jharkhand can expect major announcements in the Union Budget, Munda said he was confident that the state would receive some significant allocations.