UP tops the list in getting fund under SASCI, States hope for more funds in FY27 budget
The scheme was in focus during pre-budget meetings between Centre and States/UT on Saturday also.
As States are hoping for more funds under ‘Scheme for Special Assistance to States for Capital Investment (SASCI)’ in the forthcoming budget, Uttar Pradesh tops the list of getting funds followed by Madhya Pradesh, Bihar, Maharashtra and Assam. The scheme is combination of tied (reform measures undertaken by States/UTs) and untied (proposals forwarded by States/UTs) funding.
In the Union Budget for 2025-26, an outlay of ₹1.5 lakh crore was provided for the 50-year interest free loans to states for capital expenditure and incentives for reforms under SASCI out of which, data from Expenditure Department showed, around ₹83600 crore has been disbursed to State Governments till January 4, 2026. Since the inception of October 2020, total of around ₹4.50 lakh crore released to the state governments under SASCI till January 4.
Meanwhile, State-wise data for current fiscal is available for April 1 and November 30. Adding these to last three years showed that while Uttar Pradesh is much ahead of other States and UTs with over ₹52000 crore of sanction, Madhya Pradesh and Bihar came second and third with over ₹36000 crore of allocation. Maharashtra and Assam are on fourth and fifth place with over ₹23000 crore of fund.
The scheme was in focus during pre-budget meetings between Centre and States/UT on Saturday also. According to Finance Ministry, many participants highlighted that the SASCI be continued with higher allocations as it helps in fast-tracking asset creation and supports capital investments in the States and UTs with Legislature.
The Ministry feels that capital expenditure in the economy has a higher multiplication factor and crowds-in private investment and raises supply side capacity for enhancing economic growth. Accordingly, the Union Government came up with SASCI during FY21, under which 50-year interest free loan is provided to assist the States in boosting capital expenditure and enhance the productive capacity of the economy.
In view of the extremely positive response of the State Governments to the Schemes and their request for continuing the Scheme, the Scheme was taken forward for five years The outlay under the scheme has increased from ₹ 12,000 crore in the FY 2020-21 to ₹ 1,50,000 crores in 2025-26. In FY 26, the scheme comprises of total ten parts, from Part-I to Part-X.
Capital projects
Amount of ₹ 68,000 crore has been allocated under Part-I (Untied) of the Scheme, under which States can propose capital projects of their choice to be funded under the scheme. An outlay of ₹ 80,000 crore is for reform centric and sector specific areas.
The reforms envisaged under the scheme are – Mining Sector Reforms, Scrapping of Old Vehicles and Electronic Enforcement of Road Safety, Land-related Reforms by State Governments in Rural Areas, Digital Public Infrastructure for Agriculture, Land-related Reforms by State Governments in Urban Areas, Efficiency in Financial Management, and Urban Planning Reform. Incentives are considered after receiving recommendations from Nodal Ministries. During the fiscal, 7 States got incentives under ‘Mining Sector reform’ while 2 got for developing ‘Digital Public Infrastructure for Agriculture.’
Published on January 11, 2026
