The Sarawak Budget 2027 reflects the State’s ambitious drive toward becoming a high-income, developed economy by 2030. Anchored by the Post-COVID Development Strategy 2030 (PCDS 2030), the fiscal plan heavily prioritizes development expenditure over operating expenditure, ensuring that the majority of state funds are funnelled directly into infrastructure, rural transformation, and future-proofing the economy.

Building prosperity, securing futures

On October 12, 2026, Premier Datuk Patinggi Tan Sri (Dr) Abang Haji Abdul Rahman Zohari bin Tun Datuk Abang Haji Openg unveiled the historic Sarawak Budget 2027 before the State Legislative Assembly (DUN). Guided by the visionary theme “Together Building Prosperity and Securing Our Futures,” this landmark fiscal blueprint is distinguished by two defining milestones.

It forecasts the most substantial state revenue ever recorded in Sarawak’s history and resolutely maintains an expansionary, people-centric development strategy aimed at delivering long-term, inclusive benefits for every citizen.

Key salient features include massive allocations for bridging the urban-rural divide through accelerated road networks, water grid expansions, and digital connectivity. Furthermore, the budget underscores Sarawak’s pioneering role in Malaysia's green transition, featuring substantial investments in renewable energy initiatives such as hydrogen technology, carbon capture, utilization and storage (CCUS), and regional power export infrastructure.

Robust financial autonomy

Bolstered by the state's own revenue-generating measures—such as sales tax on petroleum products and strategic sovereign wealth funds—the budget exemplifies Sarawak’s robust financial autonomy, aiming to stimulate local industries while safeguarding social inclusivity and welfare programs for all Sarawakians.

Sarawak Budget 2027 stands testament to the tremendous financial achievement in the state fuelled by the unprecedented expected receipts of RM15.091 billion – representing an impressive growth of 16% in comparison to the figures posted last year and doubling in the last decade.

Managing this impressive inflow of finances in light of the total ordinary expenditure of RM14.845 billion, the state government has achieved an excess budget of RM246 million. Such impressive financial achievements continue to rest heavily on the State Sales Tax (SST), which continues to be the largest source of revenues at RM4.6 billion, with most of the revenues accruing from crude oil, liquefied natural gas, petroleum, and raw water royalties worth RM1.3 billion.

Development-centric allocation

The Sarawak Budget 2027 stands as a landmark step towards the realization of the goal to achieve high income and a developed state status for the region by 2030, marked by the launch of a dynamic budgeting approach that focuses on aggressive infrastructural development and socio-economic transformation.

This is exemplified by the launching of the unprecedented Massive Development Fund that diverts a massive RM9.098 billion from the ordinary budget to the Development Fund Account. Coupled with the allocations made for development purposes, this makes a total budgeted development outlay of RM10.098 billion. This massive outlay shows the strength of the state’s economy and its resolve to propel mega infrastructural projects.

Rural focus

Behind this financial power comes the unwavering rural focus, which is the moral and strategic guide for the 2027 budget. In its dedication to bridge the gap of development that has existed for decades between the cities and the interior regions of Sarawak, the government of Sarawak has dedicated a staggering amount of RM6.4 billion, 64% of the total amount of development budget, towards the rural development initiatives.

This is not just any money spent on infrastructure development, but money that is invested in the people’s livelihood in the form of development of Pan Borneo Highway Network, quick implementation of the Highlands and Coastal Roads initiatives and provision of amenities like treated water, electricity, and high-speed internet access in the longhouses and rural communities. It has been reiterated again and again that Sarawak is a land that is incomparably blessed with wealth; but the 2027 budget of Sarawak ensures that this wealth trickles down to the grassroots level.

People-centric

The 2027 Budget of Sarawak is a groundbreaking achievement for socio-economic development with a firm focus on People-Centric Policies and Welfare. The essence of this budget lies in the revolutionary introduction of free tertiary education to all the citizens of Sarawak. Not only is the state investing in education, but it is re-inventing itself in terms of intellectual capabilities for developing a high-income economy driven by technology.

In addition to education, Sarawak has set up a good policy framework for immediate subsidies on the cost of living. The budget of 2027 preserves the existing social protection systems and highlights such programmes as the financial welfare programme called Sarawak Keluarga Asas Sejahtera (SKAS), tuition and student aid, free school buses for urban families, and the reduction of the electricity bills by 25%. The mentioned measures ensure the necessary support to the vulnerable and lower-income population.

The budget of 2027 proves the fact that Sarawak's welfare system combines immediate help with long-term thinking. The allocation of the RM300 million to the Sarawak Sovereign Wealth Future Fund shows that the state protects its economy from any volatility in the markets and conserves the resource wealth of Sarawak for future generations.

All of the above-mentioned measures create a holistic social compact, which provides power to citizens through education and daily support while protecting the prosperity of Sarawak in the future.

Public infrastructure, transit

The Sarawak Budget 2027 is a historic point in time in the quest towards modern sustainable urban development. The budget allocates a whopping RM1 billion in the construction of the Autonomous Rapid Transit (ART) system. This budget is one of the most important aspects of the infrastructure and public transport revamp program of the state government.

Undeniably, the huge allocation is indicative of the dedication of the Sarawak government in the quest to transform mobility in Greater Kuching. With the incorporation of high-tech, hydrogen fuelled rail-less train, this project will ensure high-capacity mobility across the suburbs and cities. However, more than addressing the issue of traffic congestion, this project is fully in line with the green strategy of Sarawak and hence it drives key low-carbon initiatives and reduces the carbon footprint of the state.

Sarawak Budget 2027 is quite an insightful budget as it can be seen through the budgeted finances that would prepare Sarawak for the international events such as the Southeast Asian Games 2027, which will be held in Malaysia. As one of the co-hosts, the government of Sarawak has made efforts and budgeted finances towards developing its sporting infrastructure, transport system, and hospitality services.

Strategic Federal synergy

The Sarawak Budget 2027 is also significant in that there is a lot of coordination between the budget and the Federal Budget of Malaysia 2027. The backbone of this monetary coordination is the federal contribution, which has increased for Sarawak to the record figure of RM16.2 billion.

More importantly, this has involved the adoption of the interim increase of the Malaysia Agreement 1963 (MA63) Special Grant to RM1.5 billion. Not only does the contribution of federal funds justify the historical constitutional claims of the state concerning fiscal equity, but also provides it with the necessary monetary leverage to implement the PCDS 2030.