Home / Business and Economy / Budget 2026: Growth Focus, No Big Tax Shocks
Budget 2026: Growth Focus, No Big Tax Shocks
2 Feb
Summary
- Budget prioritizes growth, investment, and reform over tax giveaways.
- Increased spending targets manufacturing, infrastructure, and strategic sectors.
- Emphasis on economic resilience, self-reliance, and global supply chain integration.
Finance Minister Nirmala Sitharaman's Budget for 2026-27 emphasizes growth, investment, and reform momentum, eschewing major tax concessions. The plan aims to bolster manufacturing and infrastructure with targeted incentives, fostering economic resilience and self-reliance while deepening India's global supply chain integration.
The Budget signals intent for sectors like electronics and semiconductors, alongside efforts to boost textiles and leather exports. It also seeks to simplify tax compliance and extends a tax holiday for GIFT City, positioning India as a financial hub. Success hinges on job creation, addressing a persistent challenge.
Fiscal management remains a priority, with the deficit pegged at 4.3% and expenditure growth restrained. Capital expenditure sees a notable increase of 11.5% to Rs 12.2 lakh crore, supporting infrastructure development. The government also relies on bond markets and RBI dividends for financing.
While markets reacted to a hike in securities transaction tax and the absence of certain investor concessions, the Budget's core strategy supports sustained corporate earnings through economic momentum. Modest increases in social sector spending for education and health highlight fiscal constraints. The budget's blueprint relies on private sector investment to complement public resources.
