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India's FY27 Budget: Growth Fuelled by Capital!
1 Feb
Summary
- Fiscal deficit projected at 4.3% of GDP for FY27.
- Capital expenditure to rise, driving investment-led growth.
- Tax incentives offered for data centers and foreign experts.
India's fiscal outlook for FY27 projects stability, targeting a 4.3% deficit and a 55.6% debt-to-GDP ratio. The budget prioritizes investment-led growth with a substantial rise in capital expenditure to ₹12.2 lakh crore.
To stimulate private and foreign investment, initiatives include a credit guarantee fund for lenders and a tax holiday for data centers extended to 2047. Non-resident experts on notified schemes will also receive a five-year tax exemption.
Job creation is a central theme, with schemes like Biopharma SHAKTI and electronics manufacturing expected to generate skilled employment. The budget also aims to add 100,000 Allied Health Professionals and upskill 10,000 tourism guides.
Further economic development is planned through new logistics infrastructure, including Dedicated Freight Corridors and National Waterways. The budget also supports agriculture with new schemes and empowers women entrepreneurs via community-owned "SHE-Marts".
Technology, particularly AI, is identified as a growth driver. A committee will assess AI's job impact, while tax incentives for foreign data centers aim to boost cloud service investment.
