Karnataka Budget 2018-19 Highlights: Loan waiver for 25,000 farmers, petrol/diesel prices to go up

The government of Karnataka announced the state budget for the financial year 2018-2019. The Chief Minister H. D. Kumaraswamy who is also Finance Minister of Karnataka announced the budget in the state assembly on 5th July 2018. This is his first budget after being reelected as Chief Minister of the state. FM announced various schemes, subsidies and programs in the budget. One of the most important for farmers is Karnataka Farm Loan Waiver in which farmers who had taken a loan up to Rs 2 lakh will be wived off. Another important highlights from the state budget is increased tax on petrol and diesel. The increase in the prices of the fuel will be used to fund the agricultural loan waiver for the farmers in the state.

Karnataka Budget 2018-2019: List of schemes, programs, subsidies and budgetary allotments

Agriculture Development & Farmer Empowerment

  • Farm Loan Waiver scheme: Rs 34, 000 crore are allocated to to provide farm loan waiver for the farmers who has taken loans upto Rs. 2 lakh
  • Rs 6,500 crore allocated to provide new loans to the farmers
  • Karnataka State Farmers Advisory Committee to be formed consisting of progressive farmers to enhance farmers participation
  • Rs 150 crore are allocated for introducing dry-land irrigation based on Israel model in Kolar, Chitradurga, Kopal and Gadag
  • Rs 50 crore are allocated for Zero Capital Natural Farming project as implemented in Andhra Pradesh and is very popular

Tax Proposals

  • Increasing tax on petrol & diesel: Government increased taxes on petrol and diesel in the budget. The state tax on petrol in Karnataka is increased from 30% to 32% and on diesel from 19% to 21%. As a result of the tax increase petrol prices in Karnataka increased by Rs. 1.14 and diesel prices by Rs. 1.12 per liter
  • 100% waiver of penalty and interest on payment of full taxes
  • Excise duty increased on Indian made liquor for all 18 slabs by 4%
  • Tax on consumption of electricity increased from 6% to 9% to enforce energy conservation
  • Tax on energy will be increased from 10 paise per unit to 20 paise per unit


  • New medical college to be opened in Kanakpura, Bengalore
  • 300 bed super specialty hospital will be opened in Ramanagara, 40 crore is allocated for the same
  • Rs 150 crores allocated for modernize primary, high schools and pre-university buildings across the state
  • Biometric instruments will be provided all 48,000 governments schools in next three years

Rural Development & Water Resources

  • Jaladhare Project will be implemented in stagged manner and budget of Rs 53,000 crore is allocated
  • Video conferencing facility will be provided in all the Gram Panchayats across the state so that citizens can talk to government officials at district places and capital Bangalore. This will avoid need for people in villages to travel to district places or to Bangalore
  • Work related to Mahadayi river will be taken after river tribunal decision

Road & Transport

  • Rs 300 crores are allocated for ring road around Hasan city
  • Integrated Road Transport Authority will be setup under Chief Minister chairmanship
  • Transport Corporation of Karnataka will purchase 4236 new buses for public


  • Kayaka Scheme: To enhance skills and entrepreneurship quality, 0% interest loan up to 5 lakh and 4% loan between 5 lakh to 10 lakh for entrepreneurs and startups in Karnataka
  • Anna Bhagya Scheme: 5kg rice, 1/2kg toor dal, 1kg palm oil, 1kg iodine and iron content salt and 1kg sugar will be provided BPL card holders
  • Mathru Shree Scheme: Allowance of Rs 6,000 will be provided to lactating and pregnant woman in the Karnataka
  • Compete with China scheme: The new scheme to compete with Chinese products and increase the employment in the state. Rs. 500 crores are allocated for trainings and government is planning to invest Rs. 14,000 crores in the next five years
  • Ganga Kalyan Scheme: The irrigation scheme for SC/ST. Subsidy limit increased from Rs 3 lakh for SC and Rs 4 lakh for ST
  • Pragathi Colony Scheme: Thandas/colonies for SC and ST people in the state. Government is planning to spend the budget of Rs. 1 crore to 5 crores for such colonies

Kannada & Culture

  • Adi Shankaracharya Jayanthi to be celebrated every year
  • Various Kannada events, arts, literature, festivals will be promoted

Bengaluru Metro Region

  • Elevated corridors: Six interconnected elevated corridors will be constructed at the cost of Rs 15,825 Crore in next 4 years
  • Ring Road: Ring road of 65 kilometer to be built at the outskirts of Bengaluru at a cost of Rs 11,950 crore
  • Bellandur lake: Rs 50 core for rejuvenation of the Bellandur lake
  • Housing: Govt propose to built multi-floor houses, ground floor plus 14, for poor urban living in Bengaluru
  • Metro Network: 95 km of metro track to be built in phase 3
  • Chemical waste treatment plan: To be constructed in Pennya, Bengaluru at a cost of Rs 10 crore

PESO Examination, 2018 Admit Card released at upsc.gov.in