As Finance Minister Ajanta Neog presented the Assam Budget 2025-26, it became evident that the government is walking a fine line between welfare-driven policies and election-year populism. With the state assembly elections due next year, this budget is packed with tax relief, financial assistance programs, and subsidies, but lacks a long-term vision for economic growth and job creation.

A Budget Heavy on Welfare Measures

One of the key highlights of the budget is the exemption of professional tax for individuals earning up to ₹15,000 per month. This move is expected to benefit over 1.43 lakh taxpayers, providing some relief to the lower middle class. However, while tax cuts always bring short-term relief, they also reduce revenue inflow, something the state must compensate for in other ways.

Another major announcement is the launch of the Chief Minister’s Jibon Prerona scheme, which will provide ₹2,500 per month to fresh graduates from government universities and colleges. The government insists this is not an unemployment allowance but rather a motivational support program to help young job seekers prepare for exams and interviews. While this initiative acknowledges the struggles of fresh graduates, it does not solve the core issue of job creation in the state. Without sufficient employment opportunities, such schemes may offer temporary relief but fail to address the underlying problem.

Additionally, tea garden workers, a significant voter base in Assam, have been promised a one-time financial aid of ₹50,000 each. While this is a much-needed recognition of their contribution to Assam’s economy, it does not tackle systemic issues like low wages, lack of healthcare, and poor living conditions in tea estates. A one-time payout may provide immediate financial relief, but without long-term reforms, it does little to improve their overall livelihood.

Food Security and Power Subsidies

The expansion of essential commodity subsidies is another notable aspect of this budget. From October, NFSA ration cardholders will receive subsidies on dal, sugar, and salt, ensuring access to basic nutrition at an affordable cost. This step strengthens the existing food security system but also raises concerns about the sustainability of such subsidies in the long run.

Similarly, the ₹1 per unit reduction in electricity tariffs for domestic consumers using less than 120 units per month is expected to benefit 48 lakh households. However, the government has not provided clarity on how this will impact power distribution companies. Will this lead to higher financial burden on the state exchequer? If so, what are the plans to offset these costs?

Missed Opportunities: Where the Budget Falls Short

While the budget succeeds in addressing immediate welfare concerns, it lacks a strong vision for long-term economic growth. Several key areas remain largely unaddressed:

1. No Strong Push for Job Creation
   
   

• The budget acknowledges unemployment challenges but fails to introduce new industries, MSME support, or major investment-friendly policies that could create sustainable employment.

• Without a strong manufacturing or industrial push, Assam remains overly dependent on government schemes for livelihood support.

2. Limited Focus on Agriculture & Rural Economy
   
   

• Assam’s agrarian economy requires robust investments in irrigation, modern farming techniques, and better market access for farmers.

• The budget does not introduce major reforms or financial incentives for small and marginal farmers, leaving them largely dependent on traditional support schemes.

3. Ambiguity Over the Old Pension Scheme (OPS)
   
   

• The government has stated it will “consider” restoring OPS for government employees recruited before February 1, 2005.

• However, there is no clear commitment or timeline, which might lead to uncertainty among government employees.

4. Unclear Revenue Generation Strategy
   
   

• While the budget is heavy on subsidies, exemptions, and financial aid, it lacks a concrete plan to boost revenue.

• There are no major policy announcements regarding investment promotion, tourism expansion, or natural resource utilization, all of which could help Assam improve its revenue base.

An Election-Driven Budget?

Given that this is the last full budget before the 2026 Assembly elections, it is difficult to ignore its populist undertones. Many announcements, such as financial aid to tea workers, professional tax cuts, and subsidies on essentials, are clearly aimed at consolidating key voter bases. While welfare measures are crucial, a balanced budget should also focus on fiscal sustainability and long-term economic growth.

A Short-Term Win, But What About the Future?

The Assam Budget 2025-26 brings significant short-term relief to various sections of society but falls short of structural economic reforms. While welfare programs will benefit many, the lack of job creation measures, industry expansion, and a clear revenue strategy raises concerns about long-term sustainability.

For Assam to achieve sustained growth, future budgets must go beyond subsidies and financial handouts and focus on building a resilient economy driven by investment, employment, and innovation. Otherwise, the risk remains that such schemes, however well-intentioned, may prove unsustainable in the years to come.