In a significant budget announcement, the Indian government has approved the revised cost of the Polavaram project at ₹30,436.95 crore. Union Finance Minister Nirmala Sitharaman presented the budget for the fiscal year 2025-26, during which it was disclosed that the central government will allocate ₹12,157.53 crore as a balance grant for the project.

This allocation mirrors last year's budget, which also earmarked ₹12,000 crore for the Polavaram project. The aim is to complete this crucial initiative by 2028, with the Centre committed to facilitating funds in the form of loans to support capital construction in Amaravati, totalling ₹15,000 crore in the previous budget. The government has assured guarantees for institutions providing these loans.

Since the appointment of Chandrababu Naidu as Chief Minister of Andhra Pradesh, there has been a concerted effort to expedite capital construction work in both Polavaram and Amaravati. Naidu has conducted reviews with officials on the project's progress, while the Centre has assumed responsibility for the construction. The state government has formally requested the release of funds for expenses already incurred on the project. Following his return from Davos, Naidu discussed the budget allocations for the state with Finance Minister Sitharaman.