The Budget for 2026-27 is geared towards positioning India as a global hub for innovation and advanced manufacturing, focusing on enhancing global competitiveness, according to Challa Sreenivasulu Setty, Chairman of State Bank of India. It emphasizes policy continuity and tax predictability while striking a balance between rural and urban sectors, as well as legacy and emerging industries.
Setty highlighted that the Budget combines elements of predictability and foresight, with a focus on sectors driving growth and employment opportunities. The infrastructure sector remains pivotal, with proposed increases in investments. The banking sector sees positive prospects, with a need to adapt to evolving contexts and ensure financial market stability to support India’s growth trajectory.
The Budget also emphasizes the importance of sunrise sectors, including Semiconductors, Data Centers, Carbon Capture Utilization and Storage, and Critical Minerals. Allocations are based on a nominal GDP growth assumption of 10%, aiming for a fiscal deficit of 4.3% of GDP, aligning with prevailing inflation trends.
Notable shifts in the rural and agriculture domain include a focus on high-value products like sandalwood and cashews, along with initiatives to enhance agricultural productivity through schemes promoting coconut cultivation and orchard rejuvenation. The Budget also emphasizes the integration of AI in agriculture through Agri Stack portals.
Furthermore, the Budget underscores the significance of services such as tourism, the orange economy, and education, aligning with infrastructure expansion and digital growth plans. It introduces the ‘Education to Employment and Enterprise’ Standing Committee to drive the services sector’s role in fostering development.
In a bid to support specialized construction projects, the Budget proposes domestic manufacturing of advanced Construction and Infrastructure Equipment. It also plans to establish an Infrastructure Risk Guarantee Fund to bolster private developer confidence through credit guarantees.
Acknowledging India’s urbanization trend, the Budget aims to leverage urban agglomerations’ potential by mapping city economic regions based on growth drivers. It allocates funds for implementing development plans in these regions over five years.
Setty noted that the Budget’s focus on sunrise sectors includes scaling up the Indian Semiconductor Mission and establishing Rare Earth Corridors to address critical minerals disruption. Additionally, it introduces people-centric initiatives to enhance ease of doing business and living standards, addressing the country’s challenges.
