NEW DELHI: Finance minister Nirmala Sitharaman may not have opened the purse strings for poll-bound states in Union Budget 2026 but she made them a part of many ambitious development initiatives like the rare earth corridor, dedicated freight passage and the proposed high-speed rail networks.Assembly elections are scheduled in West Bengal, Tamil Nadu, Kerala, Assam and Puducherry later this year. With the BJP going all out to wrest Bengal from Mamata’s Trinamool Congress and make inroads in Tamil Nadu and Kerala, there were expectations that Nirmala Sitharaman would announce a slew of proposals with these states in focus like many times in the past. While the Budget did not make big-ticket state-specific announcements, there was something to cheer for all the poll-bound states.
Budget 2026
So, while Tamil Nadu got a high-speed rail link for Chennai, ecologically sustainable mountain trail in Podhigai Malai in the Western Ghats and a rare earth corridor in the Budget, poll-bound Bengal featured in many infrastructure, logistics, rail and tourism initiatives. Kerala found mention in the context of rare earths and the turtle trail.West BengalA key announcement for West Bengal was the proposal to develop a new dedicated freight corridor from Dankuni in West Bengal to Surat in Gujarat, aimed at promoting environmentally sustainable and efficient movement of cargo. The corridor is expected to significantly reduce logistics costs for industries in eastern India, and improve connectivity between the eastern and western markets.In another major push, Sitharaman said the Centre will develop an Integrated East Coast Industrial Corridor, with a well-connected industrial node at Durgapur, a key manufacturing hub in West Bengal. The project is expected to strengthen the state’s role in the Centre’s ‘Purvodaya’ vision for accelerating industrial growth in eastern India.The Budget also proposed the creation of five tourism destinations across the five ‘Purvodaya’ states, including West Bengal, to boost employment and regional development. To support sustainable urban mobility in these regions, the government also said it will make a provision for 4,000 electric buses.To boost rail connectivity, Sitharaman announced plans to develop seven high-speed rail corridors across the country, with one of the proposed routes linking Varanasi in Uttar Pradesh and Siliguri in northern West Bengal. The corridor is expected to significantly cut travel time, and enhance economic and strategic integration of north Bengal with the rest of the country.Trinamool Congress national general secretary Abhishek Banerjee accused the Centre of branding people of West Bengal as “Bangladeshis” and lambasted the finance minister for not mentioning the state in her Budget speech. “The Budget speech was 85 minutes long — 5,100 seconds — Bengal was not even mentioned. Forget Bengal; farmer, youth… there was nothing concrete for anyone. It is the Union government and its ministers, the ones who presented the Budget, they call us Bangladeshis. Bengal was not even mentioned. Jal Jeevan Mission money has been stopped, they have not even fulfilled old promises…” he said.Tamil NaduTamil Nadu got a high-speed rail link for Chennai, ecologically sustainable mountain trail in Podhigai Malai in the Western Ghats and a rare earth corridor. Bird watching trails along the Pulikat lake and development of the archaeological site of Adichanallur into a vibrant, experiential cultural destinations were among the other announcements for the poll-bound state.In Adichanallur, excavated landscapes will be opened to the public through curated walkways. Immersive storytelling skills and technologies will be introduced to help conservation labs, interpretation centres, and guides.Sitharaman also announced that Hyderabad-Chennai and Chennai-Bengaluru will be part of the seven high-speed rail corridors between cities as growth connectors. Tamil Nadu is also one of the key states that will be part of the dedicated rare earth corridor to promote mining, processing, research and manufacturing. The Centre had in November 2025 launched a scheme for Rare Earth Permanent Magnets. The proposed corridor is an extension of that effort.India has the potential and opportunity to offer world-class trekking and hiking experience. Ecologically sustainable mountain trail will be developed in Podhigai Malai in the Western Ghats. Also, bird watching trails will be developed along the Pulikat lake which covers both Tamil Nadu and Andhra Pradesh, finance minister Nirmala Sitharaman announced in her speech.Tamil Nadu, which is home to thousands of temples and pilgrimage centres like Rameswaram and has several temple-towns including Madurai, Kancheepuram and Kumbakonam, will also benefit from the initiatives announced in the Budget.KeralaKerala will be part of “rare earth corridors” and “Turtle Trails” announced in Budget 2026. The “Turtle Trails” would be established along key nesting sites in coastal regions aimed at conservation and eco-tourism. The dedicated Rare Earth Corridors aim to boost mining, processing, research and manufacturing in the sector.The state found little else to cheer, with several long-anticipated projects missing from Centre’s plans. The state was not included in the proposed high-speed rail corridors, while neighbouring Tamil Nadu, Karnataka and Telangana featured in the network expansion.Kerala’s ruling Left Democratic Front (LDF) and the Opposition United Democratic Front (UDF) criticised Budget 2026, saying it left the state largely sidelined.Thiruvananthapuram MP Shashi Tharoor said “There was a reference to an All India Institute of Ayurveda being established, but not any indication as to where. Kerala would imagine that, as a major centre of Ayurveda, it should be a logical place, but they haven’t promised us that.” “Even when coconuts and cashews were talked about, the state wasn’t mentioned. So, I am assuming that some of these subheadings she spoke about will translate into concrete projects and programmes for us….but where details came, we had reason for disappointment, for example, ship repair for inland waterways, they are parking them in Varanasi and Patna despite Kerala having so many rivers and inland waterways,” he added.AssamAssam hopes to benefit from the Union Budget’s thrust on infrastructure development of Tier-2 and Tier-3 cities, as well as the announcement of Buddhist Circuits. The focus on MSMEs will be advantageous for the poll-bound state, which has a large number of small and medium enterprises, said officials.The proposal for setting up a Buddhist Circuit in the region, including Assam, also features in the Union Budget for 2026-27. The scheme will cover preservation of temples and monasteries, pilgrimage interpretation centers, connectivity and pilgrim amenities.”The North-Eastern Region is a civilisational confluence of Theravada and Mahayana/Vajrayana traditions. I propose to launch a scheme for development of Buddhist Circuits in Arunachal Pradesh, Sikkim, Assam, Manipur, Mizoram and Tripura,” Sitharaman said.The Budget also proposes creation of five tourism destinations in the five ‘Purvodaya’ states and proposes to upgrade the National Mental Health Institutes in Tezpur as a Regional Apex Institution.In a series of X posts, Assam chief minsiter Himanta Biswa Sarma listed out several points from the Union Budget and asserted that the state is going to gain in many aspects.”The announcement of Self-Help Marts (SHE-Marts) will further strengthen Assam’s efforts towards building a robust ecosystem of Lakhpati Didis under #MMUA,” Sarma said.The chief minister maintained that the emphasis on skilling in the Budget aligns with Assam’s vision to emerge as a trusted hub for skilled professionals in healthcare, AI and other allied sectors. “This Budget provides Rs 2 lakh crore under the Special Assistance to States for Capital Investment, which will accelerate infrastructure activities in Assam,” he added. 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