New Delhi: Finance Minister Nirmala Sitharaman on Sunday presented the Union Budget 2026–27 in Parliament, setting out a wide-ranging economic and governance roadmap anchored in three “kartavyas” — accelerating growth, building people’s capacity, and ensuring inclusive development under the vision of Sabka Saath, Sabka Vikas.
This is the first Union Budget prepared in Kartavya Bhawan. The Finance Minister said the Budget aims to enhance productivity and competitiveness, strengthen resilience amid global volatility, and ensure that families, regions and sectors can meaningfully participate in India’s growth journey.
Fiscal position and budget estimates: The government has estimated total expenditure for 2026–27 at ₹53.5 lakh crore, while non-debt receipts are projected at ₹36.5 lakh crore. The Centre’s net tax receipts are estimated at ₹28.7 lakh crore. Gross market borrowings are pegged at ₹17.2 lakh crore, with net market borrowings from dated securities estimated at ₹11.7 lakh crore.
The fiscal deficit for 2026–27 is projected at 4.3 percent of GDP, compared with 4.4 percent in the revised estimates for 2025–26. The debt-to-GDP ratio is expected to decline to 55.6 percent in 2026–27 from 56.1 percent a year earlier.
First kartavya: Accelerating and sustaining economic growth: To scale up manufacturing in seven strategic and frontier sectors, the Budget announced Biopharma SHAKTI with an outlay of ₹10,000 crore over five years to develop India as a global biopharma manufacturing hub. The initiative includes setting up three new National Institutes of Pharmaceutical Education and Research, upgrading seven existing ones, and creating a network of over 1,000 accredited clinical trial sites.
The government will launch India Semiconductor Mission 2.0 to strengthen domestic capabilities in equipment, materials and full-stack design, supported by industry-led research and training centres. The outlay for the electronics components manufacturing scheme has been increased to ₹40,000 crore.
Dedicated rare earth corridors will be established to support mineral-rich states such as Odisha, Kerala, Andhra Pradesh and Tamil Nadu. The Budget also proposes chemical parks, hi-tech tool rooms, a container manufacturing scheme, and a comprehensive programme to strengthen capital goods manufacturing.
For textiles, the government announced a national fibre scheme, cluster modernisation support, mega textile parks, and targeted measures for khadi, handloom and handicrafts, including global market linkages and skilling.
A scheme to revive 200 legacy industrial clusters has been announced, along with a ₹10,000 crore SME Growth Fund to create future “champion SMEs”. Public capital expenditure will rise to ₹12.2 lakh crore in 2026–27. An Infrastructure Risk Guarantee Fund will be set up to improve private sector confidence during the construction phase of large projects.
Major logistics initiatives include new dedicated freight corridors, 20 additional national waterways over five years, coastal cargo incentives, and support for inland waterway ship repair hubs. Seven high-speed rail corridors will connect major city pairs such as Mumbai–Pune, Delhi–Varanasi and Varanasi–Siliguri.
Second kartavya: Building people’s capacity: The Budget proposes setting up a high-powered Education-to-Employment and Enterprise Committee to strengthen services-led growth. The government plans to add 1 lakh allied health professionals over five years and establish five regional medical hubs to promote medical tourism.
In education, five university townships will be created near industrial and logistics corridors. One girls’ hostel will be built in every district through viability gap funding or capital support.
Tourism will receive focused attention through the upgrade of the National Council for Hotel Management and Catering Technology into a National Institute of Hospitality and a pilot scheme to upskill 10,000 tourist guides at 20 sites. A National Destination Digital Knowledge Grid will digitally document cultural, spiritual and heritage locations.
Fifteen archaeological sites, including Lothal, Dholavira, Rakhigarhi and Sarnath, will be developed as experiential cultural destinations. The Khelo India Mission will be launched to transform the sports ecosystem over the next decade.
Third kartavya: Inclusive development: To raise farm incomes, the government announced integrated development of 500 reservoirs and Amrit Sarovars, support for high-value crops in coastal areas, and a coconut promotion scheme. A new AI-based platform, Bharat-VISTAAR, will integrate agricultural advisory systems in multiple languages.
Targeted initiatives include Divyangjan Kaushal Yojana for skill development, expansion of mental health infrastructure with NIMHANS-2, and focused development of Purvodaya and North-Eastern states. A Buddhist circuit will be developed across six North-Eastern states.
States will receive ₹1.4 lakh crore as Finance Commission grants in 2026–27.
Tax reforms and ease of living: A new Income Tax Act will come into effect from April 2026, with simplified rules and redesigned forms. The Budget announced major rationalisation of TDS and TCS, including reducing TCS on overseas tour packages and on education and medical remittances to 2 percent.
Compliance measures include simplified return revisions, automated lower-deduction certificates, integration of assessment and penalty proceedings, and decriminalisation of minor offences. Targeted tax relief has been extended to cooperatives, the IT sector and global service providers.
On indirect taxes, customs duty exemptions have been proposed to support energy transition, electronics, aviation, nuclear power and critical minerals. Customs processes will shift towards trust-based systems, wider use of AI-enabled scanning, and a single digital clearance window.
