The Gujarat government has set a rapid pace for urbanization, as evident from its increased annual budget allocation, infrastructure development, and the push for urban services in villages under urban development authorities. The state&rsquo;s plan to upgrade 69 Nagar Palikas (municipalities) signals a future where Gujarat is poised to transform into a predominantly urban state, leaving agricultural land merely as a token for farming.
State Finance Minister Kanubhai Desai presented a Rs 3,70,250 crore budget for the financial year 2025-26, reflecting an increase of Rs 37,785 crore from the current fiscal year. While the budget encompasses various schemes and policies, the overarching theme remains urbanization, with a staggering 40% rise in annual allocation, pushing the urban development budget to Rs 30,000 crore. In contrast, the rural development allocation stands at Rs 13,000 crore.
The government&rsquo;s vision of providing urban-like amenities to villages raises significant concerns. While improving infrastructure in rural areas is commendable, if implemented aggressively, it could lead to skyrocketing land prices, making agricultural land more lucrative for real estate rather than farming. Over the next decade or two, Gujarat might witness a sharp decline in agricultural land availability, gradually making way for a fully urbanized state.
Another intriguing aspect of the budget is the contradiction in transportation policies. On one hand, the government has proposed 12 high-speed corridors covering 1,367 kilometers, including the expansion of the six-lane highway between Ahmedabad and Rajkot to better connect Saurashtra&rsquo;s ports. Additionally, a new expressway is planned from Deesa to Pipavav. While this investment in road infrastructure aims to enhance connectivity, the state also plans to expand intra-state air travel services, particularly to religious destinations such as Ambaji, Dwarka, Somnath, Dakor, and Pavagadh. This raises the question: if improved road networks significantly reduce travel time, what is the viability of intra-state flights? Moreover, past attempts at intra-state air services in Gujarat have largely failed, with private operators benefiting from subsidies but eventually exiting the market. The government should consider whether such an initiative is sustainable or simply a populist move.
A particularly thought-provoking announcement in the budget is the establishment of an Administrative Reforms Commission, chaired by former bureaucrat and Chief Minister&rsquo;s advisor Hasmukh Adhiya. The formation of such a commission raises pertinent questions about governance and efficiency. It is worth recalling that in the late 1990s, Gujarat had already formed an Administrative Reforms Committee led by senior IAS officers. What happened to that report? Were its recommendations implemented, or was it merely a bureaucratic exercise with no real impact?
If this new commission is genuinely aimed at reforming governance, will it address bureaucratic downsizing? Will it suggest reducing government reliance on retired bureaucrats? More importantly, will it tackle the deep-rooted red tape that slows down administrative efficiency? These are critical questions that need clear answers.
Further, while the government talks about minimum interference and administrative efficiency, it simultaneously plans to create a new Service Sector Commissionerate. This move contradicts its own call for streamlined governance. Gujarat already has an MSME Commissionerate, yet post-COVID-19, 5,970 MSMEs have shut down in the state. If existing institutions are unable to support businesses during economic downturns, what purpose will a new commissionerate serve? Simply creating new departments without ensuring their effectiveness does little to support industry and trade.
Budgeting is meant to be an exercise in financial planning, resource allocation, and effective policy execution. However, modern budgets increasingly appear to be a play of numbers, political rhetoric, and electoral appeasement rather than genuine economic foresight. While Gujarat&rsquo;s budget for 2025-26 makes grand promises, whether it delivers tangible results remains to be seen. Less slogan-driven and more inclusive economic planning is the need of the hour.
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A deep dive into Gujarat's push for urbanization and its long-term impact on rural areas

Gujarat's Budget 2025-26: Urban Boom or Rural Decline?

A deep dive into Gujarat's push for urbanization and its long-term impact on rural areas

18:15 IST