Madhya Pradesh

Recent Developments in Key Sectors

Under the State Budget FY27

• Under the Madhya Pradesh State Budget FY 2026-27, the state allocated 13.7% of its total expenditure towards education, 6.2% towards health, 6.1% towards rural development and 6.1% towards agriculture. Allocation towards energy stood at 8.2%, while water supply and sanitation accounted for 1.7% of the total expenditure.
• The FY 2026-27 Budget also emphasised industrial and infrastructure development. Industrial parks are proposed across the state, while a telecom manufacturing zone is being established in Gwalior. The Indore-Pithampur Economic Corridor is being developed at an estimated cost of Rs. 2,360 crore (US$ 262.22 million).
• To strengthen urban infrastructure, the state launched the Dwarka Scheme with a planned expenditure of Rs. 5,000 crore (US$ 555.56 million) over the next three years.
• The government also announced the state’s first Social Impact Bond, proposed to be listed on the National Stock Exchange, to encourage private investment in the social sector.
• In the technology sector, Madhya Pradesh plans to implement the Madhya Pradesh Space Tech Policy 2026 to strengthen the state’s presence in the space and advanced technology ecosystem.
• The Madhya Pradesh government has launched the Drone Promotion and Utilization Policy 2025 to enhance drone manufacturing and applications in sectors like agriculture, logistics, security, and governance. This policy includes incentives such as a 40% capital investment subsidy, up to Rs. 30 crore (US$ 3.4 million) for new investments, and a 25% subsidy on lease rents for three years.
• Madhya Pradesh's electronic manufacturing sector is rapidly expanding, with two approved clusters and 85 companies, while the government trains 20,000 engineers under the Future Skills Programme.
• PNC Infratech has secured a new hybrid annuity highway project from the Madhya Pradesh Road Development Corporation (MPRDC) with a bid project cost of Rs. 1,174 crore (US$ 140.73 million). The announcement was made on December 18, 2023, when PNC was declared the lowest bidder (L1) for the project.
• The Union Cabinet has approved the Rs. 18,036 crore (US$ 2.16 billion) Manmad-Indore railway line project, spanning 309 km, to enhance connectivity in Maharashtra and Madhya Pradesh, benefiting industrial zones, agricultural areas, and tribal regions, while facilitating access to religious sites and promoting economic integration over an estimated eight-year construction period
• Madhya Pradesh is set to get two new airports in Guna and Shivpuri, with each airport receiving a funding allocation of Rs. 45 crore (US$ 5.40 million) from the government, which is expected to enhance regional connectivity and boost tourism, trade, and economic activities in the region.
• In 2024, Union Minister for Road Transport, Highways and MSMEs laid the foundation stones for developing 15 highway projects worth Rs. 8,038 crore (US$ 963 million) in Madhya Pradesh

Madhya Pradesh continues to strengthen its position as a fast growing and opportunity rich state, supported by rising investments, expanding infrastructure and steady economic performance. Strong agriculture, growing manufacturing capabilities, improving connectivity through new expressways, airports and rail links, and rapid growth in tourism and electronics are helping diversify the state’s economic base. Focused budget allocations for roads, energy, healthcare, education and irrigation are improving livelihoods and creating a more competitive environment for businesses. With its strategic location, abundant resources and sustained policy support, Madhya Pradesh is well placed to attract new investment and maintain balanced long term growth across sectors.

Note: ^in lakhs bales of 170 kgs each, MMT - Million Metric Tonne