Bengaluru, March 6, 2026 — Chief Minister Siddaramaiah presented the Karnataka State Budget for 2026-27 today in the Legislative Assembly, allocating a massive ₹22,436 crore to the Water Resources Department as part of the overall budget outlay of ₹4,48,004 crore. In a clear signal of priority to agriculture and water security in drought-prone regions, the government announced accelerated implementation of 75 major and medium irrigation projects worth ₹8,045 crore across the Krishna, Cauvery, and Godavari basins. The centrepiece of the irrigation thrust is the finalisation of land acquisition parameters for the long-delayed Upper Krishna Project (UKP) Stage-III, with the process set to begin this year through a negotiated consent award system.
The UKP Stage-III involves raising the height of the Almatti Dam — Karnataka’s largest reservoir on the Krishna River — from the current 519.6 metres to 524.256 metres. This will increase storage capacity from 123 TMC to approximately 300 TMC, enabling irrigation of an additional 5.94 lakh hectares (roughly 14-15 lakh acres) primarily in the parched districts of Vijayapura, Bagalkot, and surrounding areas in North Karnataka. The project had been stalled for years due to land acquisition hurdles, inter-state disputes with Maharashtra and Andhra Pradesh, and the need for central gazette notification.
In a historic and farmer-friendly move, the government has finalised compensation rates at ₹40 lakh per acre for irrigated (wet) land and ₹30 lakh per acre for dry land in submergence zones and canal networks. The state will acquire approximately 1.33 lakh acres (including over 75,000 acres that will be submerged) through negotiated settlements, bypassing lengthy litigation. This consent-based approach, approved in a special Cabinet decision last year and reiterated in the budget, is expected to speed up execution while providing generous rehabilitation packages. The total project cost is estimated between ₹70,000 crore and ₹1.22 lakh crore, with the government planning phased annual spending of ₹15,000–20,000 crore over the next four years.
“The process of land acquisition through negotiated settlements will begin this year,” CM Siddaramaiah emphasised while highlighting North Karnataka’s irrigation needs. The move addresses long-standing demands from farmers and local legislators, who had protested earlier compensation offers. Once completed, UKP-III is projected to transform the region’s economy by boosting crop productivity, recharging groundwater, and creating employment in command areas.
Beyond UKP-III, the budget outlines a comprehensive irrigation revival package:
Vuduthore Halla Irrigation Scheme (southern Karnataka): ₹490 crore allocated to irrigate 12,000 acres in Hanur taluk, Chamarajanagar district.
Hebbala-Nagavara Valley Project (Phase III): ₹237 crore to fill 164 tanks.
Hoskote taluk Lift Irrigation Scheme: ₹140 crore to fill 59 tanks.
Vrushabhavathi Valley Tank-Filling Project (Phase II): ₹650 crore for rejuvenating water bodies.
Upper Bhadra Project: Completion of Chitradurga branch canal and feeder channels to fill 157 tanks, significantly enhancing irrigation and groundwater in central Karnataka.
Yettinahole Project: Construction of a new 1.2 TMC balancing reservoir at Vaderahalli in Koratagere taluk; push for early completion of Phase II.
Tungabhadra Dam safety: Installation of 33 new gates to replace ageing structures before the monsoon.
Kalasa-Banduri (Mahadayi) Project: Work on nala diversion to commence immediately after central forest clearance, aimed at providing drinking water to North Karnataka.
Tubachi-Babaleshwar Lift Irrigation Scheme: In-principle approval for a new impounding reservoir at Babanagar in Vijayapura district.
Mekedatu Balancing Reservoir (Cauvery basin): Revised Detailed Project Report to be prepared and submitted to the Centre; construction to begin once forest clearance is obtained following Supreme Court relief.
The irrigation push is complemented by strong farmer support measures, including ₹19,290 crore in electricity subsidy for 36 lakh irrigation pump sets and a target of ₹30,000 crore in zero-interest crop loans. These steps aim to address chronic water scarcity, reduce farmer distress, and correct regional imbalances between North and South Karnataka.
### Background and Challenges
The UKP Stage-III has been on the drawing board since the early 2000s but faced repeated delays due to land acquisition costs (which ballooned due to rising market values), rehabilitation concerns for thousands of families in 20+ villages, and pending central approvals. The high compensation package — one of the most generous in recent Indian irrigation history — is designed to ensure smooth, single-stage acquisition without court appeals. However, challenges remain: inter-state water disputes, rehabilitation of displaced communities, and the need for sustained central support for related infrastructure.
Political observers note that the focus on North Karnataka irrigation is strategically significant for the Congress government, which has faced criticism over regional neglect. Deputy Chief Minister and Water Resources Minister D.K. Shivakumar has repeatedly urged Karnataka MPs to press the Centre for the required gazette notification to fully operationalise the project.
### Expected Impact
Officials estimate that successful implementation of these schemes, especially UKP-III, will add millions of acres to the state’s irrigated command area, improve agricultural output in dryland districts, and provide long-term water security amid climate change pressures. The budget’s emphasis on both major dams and minor tank-filling projects reflects a balanced approach — from mega storage structures to localised recharge initiatives.
With land acquisition for UKP-III now on a fast track and substantial funds earmarked, the 2026-27 budget marks a decisive step towards realising Karnataka’s irrigation potential. Farmers’ groups have welcomed the compensation announcement, though they continue to seek clarity on timely rehabilitation and canal network timelines.
The coming months will test the government’s ability to translate these announcements into on-ground progress, but today’s budget has undoubtedly given the state’s irrigation sector its strongest push in recent years.
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