As Finance Minister Nirmala Sitharaman prepares to present her ninth consecutive Union Budget on February 1, 2026, all eyes are on the key numbers that will shape India's economic trajectory. The budget session is scheduled to commence on January 28 and continue until April 2, 2026. With "Viksit Bharat" as the overarching theme, expectations are high that this budget will further propel India towards becoming a developed nation.

Economic Growth Projections:

India's economy is projected to grow at a robust pace in 2026, despite global headwinds. Multiple organizations have offered forecasts:

• Government Estimates: The government's first advance estimates indicate a growth of 7.4% for the fiscal year ending March 2026, up from 6.5% the previous year. This projection is driven by strong domestic demand and increased public spending.
• United Nations: The UN projects India to remain one of the fastest-growing major economies, with an expected growth of around 6.6% in 2026. Resilient household consumption, strong public investment, and a growing service sector are expected to underpin this growth.
• Asian Development Bank (ADB): The ADB has revised its FY 2025-26 growth forecast for India to 7.2%, up from 6.5%, citing strong domestic consumption and steady export performance.
• Reserve Bank of India (RBI): The RBI has raised its GDP growth forecast for FY 2025-26 to 6.8%, highlighting strong domestic demand, robust agricultural output, and a buoyant services sector.

Fiscal Deficit and Debt Management:

The government plans to anchor Budget 2026 to fiscal discipline and debt control under the "Viksit Bharat" roadmap. Prioritizing the fiscal deficit and debt-to-GDP ratio will be crucial.

Key Sectors to Watch:

Several sectors are expected to drive India's economic growth and wealth creation in 2026:

• Services Sector: The services sector remains the largest contributor to India's GDP, accounting for over 54%. Sub-sectors like trade, hotels, transport, communication, finance, real estate, and professional services are expected to be on an upward trajectory.
• Manufacturing and Construction: Manufacturing is expected to surge, supported by government initiatives and rising export demand. The construction sector is also projected to grow, driven by infrastructure projects and a booming real estate market.
• BFSI (Banking, Financial Services, and Insurance): BFSI remains the bedrock of the Indian economy. Credit expansion is expected to be a key driver for wealth creation in this sector.
• Agriculture: Agriculture is expected to grow steadily, helped by good monsoon rains and increased rural consumption.
• Green Energy: With a focus on sustainability, the renewable energy sector is anticipated to expand rapidly, driven by favorable government policies and rising demand for clean energy.

Other Key Expectations:

• Employment Focus: The budget is expected to keep employment at its core, with continued focus on job creation.
• Tax Relief for Middle Class: There are expectations that the budget will aim to sustain economic momentum while potentially offering relief to the middle class. Raising the standard deduction for salaried employees has been suggested.
• Focus on MSMEs: The Union Budget 2025–2026 is expected to focus on MSME support, innovation-driven reforms, and tax simplifications to reduce disputes and benefit domestic businesses.
• Infrastructure Development: Continued investment in infrastructure upgrades is expected to drive economic expansion.

FM Sitharaman's ninth budget is set against a backdrop of both optimism and challenges. While India's economic growth is projected to be strong, global trade uncertainties and geopolitical risks remain. The budget will need to strike a balance between promoting growth, maintaining fiscal discipline, and addressing the needs of various sectors and segments of the population.