In presenting the Union Budget 2026, Finance Minister Nirmala Sitharaman urged citizens to look beyond the immediate impact of taxes and instead focus on who the budget ultimately benefits. Sitharaman's address emphasized the government's commitment to sustained economic growth, long-term capacity building, and the welfare of the poor and underprivileged.
The Union Budget 2026 proposes a total expenditure of ₹53.47 lakh crore, comprising ₹41.25 lakh crore in revenue expenditure and ₹12.22 lakh crore in capital expenditure. A significant portion of the budget focuses on infrastructure development, with the government planning to spend ₹12.2 trillion in 2026-27, which is 4.4% of the GDP. This is an increase from the ₹11.2 trillion estimated in the 2025-26 budget. According to Sitharaman, this increase in capital expenditure is the highest ever and is intended to maintain momentum in infrastructure development and boost economic growth.
In her budget speech, Sitharaman highlighted that the government's economic trajectory over the past 12 years has been marked by stability, fiscal discipline, sustained growth, and moderate inflation. She attributed this to conscious choices made by the government, even during times of uncertainty. The government has consistently prioritized action over ambivalence, reform over rhetoric, and people over populism.
The budget includes a comprehensive package for the livestock, fisheries, and high-value agriculture sectors, with a total allocation of ₹1,62,671 crore for agriculture and related activities. This represents a 7.12% increase from the revised estimate of ₹1,51,853 crore for 2025-26. Furthermore, Sitharaman proposed supporting the Artificial Limbs Manufacturing Corporation of India (ALIMCO) to increase the production of assistive devices.
Acknowledging the external challenges of trade, multilateralism, resource access, and supply chain disruptions, Sitharaman affirmed that India would continue to pursue "Viksit Bharat," balancing ambition with inclusion. The government aims to remain deeply integrated with global markets, increasing exports and attracting long-term investment.
Several key announcements were made during the budget presentation. The finance minister announced the removal of basic customs duty on 17 cancer-related drugs and medicines. To promote infrastructure development, the budget proposes an Infrastructure Risk Guarantee Fund to provide credit guarantees, de-risk the construction phase for lenders, and attract private capital. The government will also accelerate the monetization of CPSE real estate assets through dedicated REITs, signaling a more mature approach to asset recycling.
The budget reflects the government's "sankalp" (resolve) to prioritize the poor, underprivileged, and disadvantaged, while sustaining economic momentum and strengthening India's resilience in a challenging global environment. The fiscal deficit in BE 2026-27 is estimated to be 4.3 percent of GDP. The government aims to achieve a debt-to-GDP ratio of 50±1 percent by 2030-31.
However, the budget also had some immediate market reactions. Following the announcement of an increase in the securities transaction tax (STT) on derivatives trades, the benchmark Nifty 50 index declined by 1.35%. FM Sitharaman proposed to raise the STT on futures to 0.05% from 0.02% and on options transactions to 0.15% from 0.01% earlier.