Budget 2026-27 Highlights: FM Sitharaman boosts manufacturing across sectors
Budget 2026-27 Highlights: Finance Minister Nirmala Sitharaman presented her ninth straight Union Budget in the Lok Sabha on Sunday. Catch updates here
 "Budget 2026")
Union Finance Minister Nirmala Sitharaman
Finance Minister Nirmala Sitharaman on Sunday outlined three guiding ‘kartavyas’ that will shape the government’s economic direction in the coming years, while presenting the Union Budget for the financial year 2026–27 in the Lok Sabha.
The Union Budget 2026–27 received approval from the Union Cabinet chaired by Narendra Modi and marks the first occasion on which the annual Budget is tabled on a Sunday. Sitharaman said the Budget was also the first to be prepared at Kartavya Bhavan.
Calling the framework central to building a strong and resilient India, Sitharaman said the first kartavya focuses on accelerating and sustaining economic growth. This includes improving productivity and competitiveness while “building resilience through volatile global dynamics,” she said.
The second kartavya, she said, centres on fulfilling the aspirations of citizens and building their capacity. “People must be made active and strong partners in India’s journey towards prosperity,” Sitharaman said.
Key highlights from Budget 2026
The Budget signals policy continuity with a focus on long-term economic priorities, with limited scope for abrupt shifts.
Tax compliance: The Budget introduces changes to income tax return rules aimed at simplifying compliance, extending timelines for corrections, and easing penalties for minor defaults.
Capital expenditure and fiscal approach: Prime Minister Narendra Modi said the Union Budget 2026–27 balances fiscal consolidation with growth. “This is one such unique Budget which focuses on bringing down the fiscal deficit, controlling inflation, and maintaining a combination of high capital expenditure and high growth,” Modi said.
Manufacturing and industrial focus: Manufacturing remains central to the expenditure framework, with allocations directed towards strategic and industrial segments. Presenting the Budget, Sitharaman said the government remains committed to strengthening domestic manufacturing capacity and reducing dependence on critical imports.
India Semiconductor Mission 2.0: The government will launch India Semiconductor Mission (ISM) 2.0 with an outlay of ₹40,000 crore to strengthen semiconductor equipment manufacturing, materials, and research.
“India’s Semiconductor Mission 1.0 expanded sector capabilities. Building on this, we will launch ISM 2.0 to produce semiconductor equipment and materials, develop full-stack Indian intellectual property, and strengthen supply chains,” Sitharaman said.
Rare-earth manufacturing corridors: To support domestic production of rare-earth magnets, the government will develop dedicated rare-earth corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu.
In December last year, the government approved a ₹7,280 crore scheme to promote manufacturing of sintered rare-earth permanent magnets, aimed at creating 6,000 tonnes per annum of integrated magnet manufacturing capacity across the value chain.
Biopharma Shakti initiative: The Budget announced ‘Biopharma Shakti’, a ₹10,000 crore programme aimed at positioning India as a global biopharma manufacturing base.
“Biopharma Shakti, meaning BioPharma Strategy for Health Advancement through Knowledge, Technology and Innovation, addresses the shift in India’s disease burden towards non-communicable diseases such as diabetes, cancer, and autoimmune disorders,” Sitharaman said.
As part of the initiative, the government will establish an institutional network focused on biopharma research, manufacturing, and innovation.
8:45 PM
FM Sitharaman boosts manufacturing across sectors
Finance Minister Nirmala Sitharaman on Sunday outlined a manufacturing-led growth strategy in the Union Budget 2026–27, with targeted support for semiconductors, rare-earth processing, biopharma and strategic industries, signalling a push to strengthen domestic capacity and reduce import dependence.
8:21 PM
Opposition flags lack of poll-state sops in Budget 2026–27
The Union Budget 2026–27 did not announce major state-specific packages for regions heading to polls this year, including Tamil Nadu, West Bengal, Assam, Kerala and Puducherry, with Finance Minister Nirmala Sitharaman stating that adequate provisions had been made for all states.
Opposition parties, particularly those in power in Tamil Nadu, West Bengal and Kerala, criticised the Budget, arguing that it offered little for their states. They said the government chose to prioritise fiscal discipline over populist spending despite elections due in four states and one Union territory in the coming months.
(With inputs from PTI)
(With inputs from PTI)
8:19 PM
Budget 2026–27 cuts NATGRID allocation by over 27%
The Union Budget 2026–27 has reduced funding for the National Intelligence Grid (NATGRID) by more than 27 per cent, trimming allocations for the internal security data-sharing platform under the Police head of the Ministry of Home Affairs.
NATGRID has been allotted ₹108.98 crore for FY27, down by ₹40.54 crore from the revised estimate of ₹149.52 crore in 2025–26. According to the Budget documents, the allocation is meant for the National Intelligence Grid, which links databases across security and intelligence agencies to enhance capabilities for combating terrorism and addressing internal security threats.
8:05 PM
Budget 2026–27 hikes Intelligence Bureau allocation by 63%, capex jumps ninefold
The Intelligence Bureau received ₹6,782.43 crore in the Union Budget 2026–27, reflecting a steep increase of about 63 per cent over the revised estimates of the previous year. Capital expenditure for the IB saw a ninefold jump to ₹2,549.54 crore, indicating significant investments to enhance its operational and intelligence-gathering capabilities. According to the Budget documents, the allocation is aimed at meeting administrative and operational expenses linked to internal security and threat assessment.
(With inputs from PTI)
(With inputs from PTI)
7:57 PM
Budget 2026 credit push strengthens MSME, startup financing: Stashfin co-founder
The Union Budget 2026–27’s focus on expanding access to credit and strengthening MSME lending will help build a more predictable and inclusive financial ecosystem, Shruti Aggarwal, co-founder of Stashfin, said.
“Union Budget 2026–27 highlights a strategic approach to fostering entrepreneurship and supporting the growth of MSMEs by improving access to formal credit and financial resources,” Aggarwal said, adding that streamlined financing channels, better liquidity and deeper digital integration will enable entrepreneurs and young professionals to plan, scale and participate more confidently in the economy.
7:56 PM
Budget 2026–27 allocates ₹2.55 trillion to Ministry of Home Affairs
The Union Budget 2026–27 allocated over ₹2.55 trillion to the Ministry of Home Affairs, marking an increase of about 9.4 per cent from the ₹2.33 trillion provided in 2025–26. Of this, nearly ₹1.73 trillion —around 68 per cent—has been earmarked under the ‘Police’ head, covering funding for central armed police forces, border development programmes, and police forces in Delhi and Jammu and Kashmir. Capital expenditure under the Police head rose sharply to ₹21,272.47 crore, signalling a renewed focus on modernisation and infrastructure for security forces.
(With inputs from PTI)
7:46 PM
Budget 2026–27 strengthens export ecosystem through systemic reforms: Commerce Secy
The Union Budget for 2026–27 introduces a range of measures that offer strong systemic support to India’s export ecosystem, with an emphasis on manufacturing and trade facilitation, Commerce Secretary Rajesh Agrawal said on Sunday.
Agrawal said the Budget addresses the needs of both labour-intensive and high-technology sectors, while its focus on logistics and trade facilitation is expected to reduce compliance burdens and improve India’s share in global trade. “It is an excellent Budget that provides strong systemic support to the trade ecosystem by focusing on manufacturing, trade facilitation and new areas,” he said, adding that the measures will also aid trade diversification.
7:42 PM
Budget’s turtle trail push raises hopes for Odisha research centre: Wildlife activists
Wildlife activists on Sunday said they hope the proposed sea turtle research centre in Odisha’s Ganjam district will move forward faster after Finance Minister Nirmala Sitharaman referred to “turtle trails” near key nesting sites in her Budget speech, news agency PTI reported.
Odisha Chief Minister Mohan Charan Majhi said turtle trails would be developed around major nesting areas in Odisha, Karnataka and Kerala to promote wildlife tourism alongside environmental conservation. The nature-based tourism initiative announced in the Budget will prioritise eco-friendly tourism infrastructure, he said.
7:40 PM
Budget aims to establish stable regulatory environment, enable cos to focus on growth: ICAI
The Institute of Chartered Accountants of India (ICAI) on Sunday said the proposals outlined in the Union Budget 2026–27 are aimed at creating a predictable regulatory framework that allows businesses to focus on innovation and expansion.
ICAI President Charanjot Singh Nanda said the Budget proposals are aligned with the broader objectives of the Income Tax Act, 2025. “By bringing greater clarity and transparency to the law, these measures seek to provide a stable regulatory environment that enables enterprises to concentrate on innovation and growth, thereby strengthening the ease of doing business,” he said in a statement.
7:32 PM
Budget 2026 backs science-led Ayurveda, global scale-up: Nat Habit CEO
The Union Budget 2026 signals a clear intent to position Ayurveda and AYUSH as scalable, science-backed contributors to India’s beauty and wellness economy, Swagatika Das, chief executive officer and co-founder at Nat Habit, said.
“The creation of three new All India Institutes of Ayurveda strengthens the research, standardisation, and clinical validation framework the sector needs to build global credibility,” Das said, adding that the push on exports and inclusion-led initiatives such as She MARTS will support a future-ready, globally competitive Ayurveda beauty ecosystem.
Topics : Nirmala Sitharaman Budget 2026 Union Budget taxes Direct taxes Finance minister Indian Economy manufacturing Jobs in India
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First Published: Feb 01 2026 | 6:59 AM IST