Budget 2026: Calibrated approach anchors atmanirbhar India vision

The Union Budget presents a balance of ambition and pragmatism. It has remained consistent on fiscal discipline, capex spending, import substitutions, and job creation. Against a backdrop of persistent global trade uncertainty, the finance minister has reinforced the country’s atmanirbhar (self-reliant) vision, seeking to insulate the economy from external disruptions while building domestic resilience.

 

A key takeaway is the renewed emphasis on micro, small, and medium enterprises (MSMEs), a sector that has endured significant stress. The proposed Rs 10,000 crore MSME Growth Fund reflects the government’s intent to participate as an equity partner in their growth. The proposal for mega textile parks is equally timely, especially in light of the India-European Union free trade agreement, which could help Indian exporters regain lost market share.

 

On capital markets, the increase in the securities transaction tax is likely to temper trading activity. The intent appears focused on moderating volumes rather than maximising revenue. This move, however, is partially offset by allowing persons resident outside India, or PROIs, to double equity investment limits to 10 per cent, a supportive step at a time of subdued foreign institutional investor inflows. The shift to taxing buybacks as capital gains is a mixed bag — favourable for long-term retail investors, but potentially burdensome for promoters.

 

Strategic investments announced in electronics, data centres, rare earth minerals, biopharma, Railways, inland waterways, etc. are critical to building long-term domestic capabilities, strengthening supply chains, and enhancing competitiveness. The incentives for domestic tourism, including medical, foreign travel and education, urban development and duty reduction on select drugs, too, will augur well for citizens.

 

The proposal to constitute a banking committee for Viksit Bharat (developed India) signals a willingness to rethink India’s banking architecture beyond incremental reforms. Yet, the absence of clarity on the privatisation of public sector banks remains a missed opportunity. 

 

Overall, the Budget conveys cautious optimism, with its impact hinging on sustained fiscal discipline.

 

The writer is executive chairman, Centrum Group