Madhya Pradesh (MP) has taken a historic step in state budgeting by becoming the first Indian state to adopt a three-year rolling budget, starting from the financial year 2026-27. This innovative approach in fiscal planning was formally announced by Deputy Chief Minister and Finance Minister Jagdish Devda. The initiative focuses on long-term growth, fiscal transparency, public participation, and enhanced budgeting outcomes that reflect the aspirations of citizens and stakeholders.
A three-year rolling budget differs significantly from the conventional one-year annual budget. In the traditional model, fiscal planning is static and often reflects only short-term revenue and expenditure expectations. In contrast, under a rolling budget:
This model transforms the budget from a one-time statement into a dynamic tool for continuous fiscal management and strategic policy planning.
One of the standout features of MP’s rolling budget is inclusive budget-making. The government organised a Budget Dialogue Programme, inviting suggestions from economists, budget experts, intellectuals, and citizens. The aim is to ensure that the budget reflects public expectations and democratic principles. Inputs received during this dialogue are factored into planning and policy formulation.
The rolling budget emphasises higher capital expenditure, which means MP is likely to invest more in infrastructure, education, health, and other growth-oriented sectors. Capital expenditure is crucial for long-term development as it supports the creation of durable assets like roads, schools, hospitals, and industrial corridors.
The rolling budget is aligned with the state’s long-term vision — “Viksit Madhya Pradesh 2047” — which aims to transform the state into a modern, inclusive, and economically stronger region by the year 2047. This initiative is expected to bring fiscal discipline, robust financial planning, and sustained economic development.
For candidates preparing for government exams such as UPSC Civil Services (IAS, IFS), State PSCs, SSC, Banking, Railways, and Defence Services, this development is a high-value current affairs topic under Economy and Governance. This is because budget reforms reflect how governments manage public resources, plan for development, and implement policy priorities — subjects frequently asked in General Studies Papers, Economic sections, and Interview rounds.
Understanding the three-year rolling budget equips aspirants with insights into modern budgeting practices—moving beyond static annual planning toward dynamic and responsive fiscal systems. This is especially relevant for questions on government finances, economic planning, budget reforms, and state governance models
The inclusion of public feedback through initiatives such as the Budget Dialogue Programme highlights democratic governance in fiscal planning — a key point for exams focusing on governance, public administration, and participatory budgeting. Questions related to citizen participation in policymaking often arise in competitive assessments.
Madhya Pradesh’s move sets a benchmark for other Indian states, offering a replicable model of fiscal transparency and medium-term planning. Aspirants should remember this as an example of state-level innovation in budgeting.
Historically, Indian states and the Union Government have relied on annual budgets, where financial planning is constrained to a single fiscal year. Such budgets focus on estimating revenue and expenditures for that year without formal projections for the future. This often resulted in short-term planning and limited adaptability to changing economic conditions.
With increasing complexities in governance, rapid socio-economic changes, and the need for sustainable development, there has been a global shift toward medium-term fiscal frameworks (MTFFs) that cover multiple years. Many advanced economies incorporate such practices to ensure fiscal discipline and strategic planning.
Madhya Pradesh’s decision to implement a three-year rolling budget marks a first in India, reflecting global best practices in public financial management. This also aligns with modern governance principles such as transparency, accountability, and adaptability.
The three-year rolling budget is a fiscal planning model that includes a detailed budget for the first year (2026‑27) and indicative projections for the following two years (2027‑28 and 2028‑29). It allows dynamic revisions annually and ensures medium-term fiscal planning.
The initiative was announced by Deputy Chief Minister and Finance Minister Jagdish Devda as part of the state’s effort to improve fiscal transparency and planning.
The government organized Budget Dialogue Programmes where citizens, economists, and budget experts could provide suggestions. This ensures that budget planning incorporates public opinion and democratic principles.
This is important for exams like UPSC, State PSCs, SSC, Banking, Railways, and Defence because it highlights modern fiscal reforms, governance, economic planning, and public administration practices — common topics in General Studies papers.
The budget focuses on capital expenditure, benefiting sectors like infrastructure, health, education, and industrial development, supporting long-term economic growth.
It supports “Viksit Madhya Pradesh 2047”, aiming for a modern, inclusive, and economically stronger state through disciplined fiscal management and sustainable growth.
Unlike the annual budget, which focuses on one-year fiscal planning, a rolling budget spans three years with regular updates, allowing adaptability and medium-term strategy formulation.
Yes, Madhya Pradesh’s initiative sets a benchmark for other Indian states, demonstrating how medium-term fiscal frameworks can improve governance and public resource management.
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