Thiruvananthapuram, Feb 7 (PTI) Kerala Chief Minister Pinarayi Vijayan hailed the state budget presented by Finance Minister K N Balagopal on Friday as a “creative intervention” driving Kerala's development vision, while the Congress-led opposition dismissed it as “hollow”.

"Despite financial constraints and economic discrimination by the Union government, the 2025-26 budget adopted an approach to strengthen Kerala’s development and the welfare of the people. The budget focuses on short-term reliefs and long-term development," Vijayan said in a statement.

Resources have been mobilised without burdening the lives of common people, with new avenues identified for revenue generation, he said.

Even in the face of fiscal challenges posed by the Centre’s alleged denial of Kerala’s rightful share, the budget remains committed to both public welfare and development, he said.

The budget aims to protect ordinary consumers from the impact of rising prices in the national scenario and focuses on building a "Nava Keralam" (new Kerala), enhancing the knowledge economy, expanding infrastructure, securing the future of the younger generation, and improving the quality of life for basic communities, the release added.

Chief Minister also said the state budget is a creative intervention that will provide fresh impetus to Kerala’s development vision.

The key announcements in the budget include measures to upgrade educational institutions to higher standards and enhance the efficiency of the public healthcare system, according to the CM.

"This budget ensures inclusive and balanced development across all sectors, serving as Kerala’s economic roadmap for comprehensive progress. Despite political attempts to weaken the state through financial restrictions, it demonstrates Kerala's ability to overcome such challenges by identifying alternative avenues for resource mobilisation," Vijayan said.

Leader of Opposition in the Assembly V D Satheesan alleged that the Left government’s budget for the fiscal 2025-26 lacks any mention of Kerala's financial status and is merely filled with 'hollow' words.

Speaking to the media after the budget was presented by state Finance Minister K N Balagopal, Satheesan criticised the budget for lacking realism.

He added that no funds have been allocated to clear the debts and losses incurred by various government departments and institutions."There has been a significant cut in welfare programs, including scholarships for minority students and initiatives for SC communities, while many announcements are repetitions," he said.

"The floor price of rubber has been raised from Rs 170 to Rs 180 per kg. However, with the current market price at Rs 208-210, farmers would already receive Rs 28 more, making this announcement meaningless," he said.

The 50 percent hike in land tax is only aimed at drastically looting the common people, he alleged. Satheesan alleged that the government has miserably failed in tax collection. He pointed out that as a consumer state, Kerala should have seen a 30 percent growth in GST revenue, but the state fell short due to the flawed tax structure implemented by this government.

An inefficient tax administration system exists in the state, he further alleged.

"What is the logic behind claiming to increase the plan fund to Rs 2,000 crore while cutting 50 percent of the state's plan fund?" he asked.

Satheesan further stated that the final budget of the second Pinarayi Vijayan-led government is pushing the state into deeper financial distress.

BJP state president K Surendran criticised Finance Minister Balagopal's budget speech, calling it more of a public address than a financial plan, as it allegedly lacked major announcements to address the state's financial issues. PTI ARM ARM ADB

State budget framed as balancing relief and development, while critics say it lacks fiscal realism and weakens welfare protections. The 2025-26 state budget seeks to balance short-term reliefs and long-term development by mobilising resources without increasing burdens on citizens, prioritising education, healthcare, infrastructure and social welfare, and alleging compensatory measures for constrained central transfers; the opposition contends the budget lacks fiscal realism, cuts key welfare programs, repeats symbolic measures, and reflects weak tax administration and insufficient revenue mobilization.