Apex business chamber CII has put forward a comprehensive fiscal strategy for the upcoming Union Budget 2026-27. The strategy focuses on debt stability, fiscal transparency, revenue mobilisation, and expenditure efficiency. CII emphasizes the importance of maintaining the government’s debt glide path to target 50% of GDP by FY31.
To enhance predictability and institutional credibility, CII suggests reviving the Medium-Term Fiscal Framework with a 3-5 year roadmap for revenue, expenditure, and debt. Revenue mobilisation is highlighted as crucial for long-term fiscal sustainability, with India’s tax-to-GDP ratio currently below that of major emerging economies.
CII Director General Chandrajit Banerjee stresses the need to increase India’s tax-GDP ratio to finance the country’s developmental needs. The organization recommends leveraging digital infrastructure to detect tax evasion and expand the tax base. Moreover, CII advocates for the use of digital and AI-based tools to facilitate seamless data exchange between different tax systems.
In a bid to unlock value from public assets, CII proposes a three-year privatisation pipeline of Public Sector Enterprises in non-strategic sectors. Expenditure management, particularly subsidy reform, is identified as another key aspect of the strategy. CII suggests updating beneficiary lists for the Public Distribution System and transitioning fertiliser subsidies to a Direct Benefit Transfer model for enhanced efficiency.
The organization also calls for the consolidation of Centrally Sponsored Schemes to reduce fragmentation and prioritize high-impact areas like education, health, skilling, and climate resilience. Encouraging states to obtain ratings for State Development Loans and linking central capital expenditure assistance to such ratings is recommended to promote financial prudence.
Additionally, CII advocates for a Systematic Modernisation and Resource Transformation Cities Enablement Mission to bolster municipal finance, governance, and digital service delivery. The proposal includes the establishment of a Fiscal Health Index for Urban Local Bodies to drive transparency, benchmarking, and reform-linked incentives for improved financial health and service delivery.
