Budget 2026: Charting India's Decade of Growth and Global Integration
As India approaches Budget 2026, the nation stands at a pivotal juncture, poised to consolidate its economic gains and accelerate into a new phase of sustainable development. This budget is not merely a financial statement but a strategic blueprint that will signal India's direction for the decade ahead, building on the robust foundations laid by previous reforms.
Consolidating Economic Gains Through Tax Reforms
The transformative impact of recent fiscal policies is evident in the remarkable growth of GST collections, which have doubled from ₹11.37 lakh crore in FY21 to ₹22.08 lakh crore in FY25. Concurrently, the taxpayer base has expanded significantly, from 66.5 lakh to over 1.5 crore, reflecting not just revenue enhancement but a deeper formalization of the economy. The personal income tax regime changes announced last year have further catalyzed this growth, while the GST reforms of September 2025 have simplified a previously complex system, fostering greater compliance and efficiency.
Infrastructure and Capital Expenditure: Shifting Focus to Efficiency
Infrastructure investment has seen a substantial rise, increasing by 11% last year to ₹11.11 lakh crore, maintaining capital expenditure at 3.4% of GDP. As this scale of spending continues, the emphasis must evolve from mere capacity creation to debottlenecking and achieving efficiency gains. The PM Gati Shakti data, made visible in the last budget, now serves as a powerful planning tool for investors and users, enabling targeted interventions in ports, airports, connectivity, and logistics networks to maximize returns.
Global Integration and Access to Long-Term Capital
India's deeper integration into global supply chains necessitates access to long-term capital. Last year's budget provisioned a ₹1 lakh crore fund for R&D and innovation, which is now being operationalized to help Indian companies acquire overseas intellectual property and technology. To build on this, a complementary mechanism, such as a sovereign-backed vehicle or a focused fund under the National Investment and Infrastructure Fund, could enable Indian firms to acquire manufacturing capacity overseas and integrate into global value chains, benefiting the domestic economy through enhanced competitiveness.
Employment Generation: A Central Pillar of Budget 2026
Employment generation must remain at the heart of Budget 2026. The Employment Linked Incentive (ELI) scheme provides a strong foundation by linking job creation with formalization and skilling. This year's budget should encourage deeper industry and training institution participation in skilling initiatives, with sectors like logistics and tourism offering significant potential. Logistics employs 20–22 million people and can add millions more, while tourism supports over 40 million jobs directly and indirectly, making them priority areas for focused certification and upskilling through National Skill Training Institutes (NSTIs).
Empowering MSMEs and Enhancing Business Environment
Micro, small and medium enterprises (MSMEs) continue to be the backbone of job creation, supported by increased funding under various schemes. Coordinated collaboration with industry bodies and sectoral Centres of Excellence can improve connectivity with MSMEs, enabling large corporates to support them and translate policy intent into measurable growth and employment outcomes. Policies must be evaluated through lenses of ease of doing business and cost of doing business, with benchmarks against global best practices in areas like mergers and acquisitions to strengthen India's competitiveness.
Digitization and Technology-Led Processes
The budget must prioritize deeper digitization and technology-led processes to speed up approvals and clearances, complementing rate rationalization efforts. Recent references by the finance minister to customs and trade facilitation reforms are timely, especially as global supply chains reconfigure. By signaling intent on these fronts, Budget 2026 can significantly enhance India's position in the global economy.
With the finance minister having presented eight consecutive budgets of far-reaching consequence, there is confidence that Budget 2026 will decisively advance India's journey towards a Viksit Bharat, ensuring equitable and inclusive growth that carries forward the aspirations of society.
