New Delhi: Finance Minister Nirmala Sitharaman on Saturday unveiled the Union Budget 2026–27, charting an aggressive growth roadmap driven by infrastructure, advanced manufacturing, biotechnology, digital agriculture and global services, while maintaining fiscal discipline.
The budget projects India as a “future-ready” economy by 2047, but offers no direct income-tax relief to the salaried middle class, leaving many disappointed.
Fiscal Discipline with Growth Push
The fiscal deficit for FY27 has been pegged at 4.3% of GDP, continuing the government’s glide path towards stability.
Gross market borrowing is projected at ₹17.2 lakh crore, reflecting sustained public investment to fuel growth.
Infrastructure: The Backbone of the Economy
Capital expenditure has been raised to a record ₹12.2 lakh crore, nearly 9% higher than last year.
Key highlights include:
- Seven high-speed rail corridors linking major economic hubs
- Expansion of freight corridors and logistics parks
- Dedicated rare-earth corridors in mineral-rich states to strengthen strategic supply chains
Biopharma & Healthcare: A Strategic Leap
The government launched the Biopharma SHAKTI Mission with an outlay of ₹10,000 crore over five years to make India a global biopharma manufacturing hub.
In a major relief for patients, the Budget removed basic customs duty on 17 cancer-related drugs and several critical medicines, making life-saving treatments more affordable.
The plan includes new biopharma institutes and a stronger digital healthcare ecosystem.
NIMHANS 2.0 and a National Mental Health Centre in North India were also announced.
To scale up manufacturing in strategic and frontier sectors, the Union Finance Minister proposed to launch:
👉 Biopharma SHAKTI
👉 India Semiconductor Mission (ISM) 2.0
👉 Electronics Components Manufacturing Scheme
👉Dedicated Rare Earth Corridors in Odisha, Kerala,… pic.twitter.com/pYxjYJh2q3— Ministry of Finance (@FinMinIndia) February 1, 2026
Semiconductor & Advanced Manufacturing Push
The India Semiconductor Mission 2.0 received a fresh ₹40,000 crore boost to develop domestic equipment, materials, Indian IP and resilient supply chains.
Electronics, clean-tech and advanced manufacturing will receive expanded production-linked incentives.
IT & Global Services Boom
Major reforms aim to position India as a global digital services hub:
- Tax holiday till 2047 for foreign cloud service firms using Indian data centres
- Faster transfer-pricing certainty through fast-track APAs
- Easier compliance for multinational companies
India aims to capture 10% of global services exports by 2047.
Digital Agriculture for Farmers
AI-based advisory platforms in local languages will provide real-time crop, weather and market guidance, pushing agriculture towards precision and high-value production.
MSMEs Get a Growth Shield
A ₹10,000 crore MSME Growth Fund will offer equity support to create globally competitive Indian enterprises, alongside credit and technology upgradation.
Tax & Compliance Changes
While personal income-tax slabs remain unchanged, the budget simplifies compliance through:
- Lower TCS for education and medical treatment abroad
- Easier property sale compliance for non-residents
- Relief for small-value foreign asset disclosures
Green Tech, Aviation & Rural Push
- Customs duty waivers for civilian aircraft manufacturing and MRO
- ₹20,000 crore for carbon capture and climate technologies
- One girls’ hostel in every district
- Khadi, handloom and handicraft promotion under Gram Swaraj
- Expanded women entrepreneurship through Lakhpati Didi
Mahatma Gandhi Gram Swaraj Initiative
A major rural transformation programme, the Mahatma Gandhi Gram Swaraj Initiative, will strengthen:
- Khadi, handloom and handicrafts
- Global branding and market linkages
- Training, skilling and quality certification
It will benefit weavers, village industries, rural youth and the One District One Product (ODOP) programme.
Union Budget 2026–27 is a bold future-focused blueprint that bets heavily on infrastructure, biotechnology, semiconductors, digital services and green growth.
However, the lack of middle-class tax relief has left public expectations only partly fulfilled.
