Prime Minister Narendra Modi commended Finance Minister Nirmala Sitharaman for her detailed Lok Sabha speech outlining how this year’s Union Budget will drive India’s economic transformation. Sitharaman highlighted key areas like Reform Express, support for MSMEs, infrastructure development, healthcare, and education. Meanwhile, Sitharaman stated that the total resources allocated to states in the 2026-27 Budget, including tax shares and central scheme funds, will amount to Rs 25.44 lakh crore, marking a significant increase from the previous year.
Finance Minister Sitharaman refuted claims of reduced resource transfers to states, emphasizing that state allocations have actually risen. She assured that all dues have been promptly transferred to the states, with 41% of tax proceeds being shared as per Constitutional norms. Additionally, she noted that the Budget allocates Rs 17.15 lakh crore for capital investment, with a substantial multiplier effect expected to boost economic growth.
Sitharaman highlighted that the Budget’s capital expenditure, amounting to 3.1% of GDP, has seen an 11.5% increase from the previous year. Including transfers to states under central schemes, the total capex stands at 4.4% of GDP. She dismissed claims of reduced developmental spending, emphasizing the government’s inclusive approach by inviting all states to participate in various development schemes.
The Finance Minister welcomed states to engage in initiatives like establishing mega food parks, IT parks, smart cities, and healthcare hubs. She emphasized the government’s focus on labor-intensive sectors, legacy industries, and high-value agriculture, aiming to benefit farmers and promote digital support through the Agri stack. Sitharaman also highlighted plans for mega entrepreneurship and education centers across states, aiming to foster skill development and entrepreneurship opportunities.
