India’s Union Budget 2026-27, presented by Finance Minister Nirmala Sitharaman on February 1, 2026, emphasizes Yuva Shakti-driven growth guided by three kartavya: economic acceleration, aspiration fulfillment, and inclusive development. Key facts include ₹12.2 lakh crore public capex (up 9%), fiscal deficit at 4.3% of GDP, and total expenditure of ₹53.5 lakh crore. Major highlights feature Biopharma SHAKTI (₹10,000 cr), ISM 2.0, MSME funds, 7 high-speed rail corridors, CCUS (₹20,000 cr), tax simplifications, and schemes for tourism, skills, and healthcare.
Key Facts of the Union Budget 2026-27
| Announced on | February 1, 2026 |
| Presented by | Smt. Nirmala Sitaraman (Hon’ble Union Finance Minister of India) |
| Nature of Budget | Regular Budget* |
| Key Priority Areas | Investment-Led Growth: ₹12.2 lakh crore capex; scale semiconductors, biopharma, electronics, rare earths; revive 200 clusters, champion MSMEs. Infrastructure & Logistics: 7 high-speed rails, 20 waterways, Tier II/III cities, ₹5,000 cr City Economic Regions, 4,000 e-buses in Purvodaya. Energy & Climate: ₹20,000 cr CCUS for power/steel/cement; energy security, clean tech. Skills & Employment: ‘Education to Employment’ panel; AI assessment; services to 10% global share; IT tax relief. Agriculture & Rural: Irrigation boost, oilseeds/millets, digital tools, warehousing, aquaculture. Healthcare & Social: Geriatric care, AYUSH institutes, trauma centers, 5 medical tourism hubs. |
In addition to the key facts, the following section presents interesting details:
- With the announcement of Budget 2026-27, Smt. Nirmala Sitharaman has become the first Union Finance Minister to present 9 Union Budgets consecutively.
- Till now, she shared the record of presenting the maximum number of consecutive Union Budgets with Shree Morarji Desai, who had presented 9 consecutive Union Budgets (8 Regular Budgets + 1 Interim Budget).
- This 2026 Budget is the first budget of Modi 3.0.
- Yuva Shakti theme: First budget guided by three “kartavya” duties for youth-led development.
- High-Speed Quadrilateral: 7 rail corridors linking Mumbai-Pune-Hyderabad-Bengaluru-Chennai-Varanasi-Siliguri hubs.
- ₹20,000 cr twin funds: For CCUS tech and small modular nuclear reactors toward net-zero 2070.
- City Economic Regions: ₹5,000 cr/region for Tier II/III urban clusters via reforms.
- Tax holiday till 2047: For foreign cloud providers using Indian data centers.
What is the Budget?
- The Budget is a statement of the estimated receipts and proposed expenditures of the Government for an upcoming financial year i.e. a period that runs from 1st April to 31st March of the ensuing year.
- It serves as a comprehensive financial plan that reflects the economic strategy and policy priorities of the Government.
Key Concepts of Budget
The key concepts related to Budget, its formulation, presentation, and enactment can be learned through the following articles:
Major Highlights of the Budget for FY 2026-27
Union Budget 2026-27, presented by Nirmala Sitharaman, emphasizes youth-led growth via three “kartavya” duties.
Fiscal Highlights
- Public capex hiked to ₹12.2 lakh crore (9% up), fiscal deficit at 4.3% of GDP.
- Total expenditure ₹53.5 lakh crore; net tax revenue ₹28.7 lakh crore.
Sector Priorities
- Manufacturing Boost: Biopharma SHAKTI (₹10,000 cr), electronics scheme, 200 legacy clusters revival.
- Infrastructure: 7 high-speed rail corridors, 20 waterways, ₹5,000 cr City Economic Regions.
- Energy Transition: ₹20,000 cr CCUS fund for steel/cement/power.
- Skills & Jobs: ‘Education to Employment’ committee, AI impact study, services sector push.
- Agriculture: High-value crops via Bharat-VISTAAR, irrigation, millets focus.
- Healthcare/Social: Geriatric care, 3 AYUSH institutes, 5 medical tourism hubs, mental health upgrades.
Key Announcements in the Annual Budget 2026
Union Budget 2026-27 features bold key announcements for growth.
- Capex Surge: ₹12.2 lakh crore public investment to boost infrastructure and manufacturing.
- High-Speed Rails: 7 corridors forming a quadrilateral linking major economic hubs.
- CCUS Mission: ₹20,000 crore fund for carbon capture in steel, cement, power.
- Biopharma SHAKTI: ₹10,000 crore scheme for biologics and vaccines manufacturing.
- City Economic Regions: ₹5,000 crore per region for Tier II/III urban clusters.
- Tax Simplification: Unified IT services taxation, cloud provider holiday till 2047.
Economic Outlook Based on the Budget 2026
Union Budget 2026-27 projects robust economic growth amid global challenges.
Growth Projections
Economic Survey 2026 forecasts 6.8-7.4% real GDP growth for FY26, driven by strong domestic demand, sustained capex, and private investment revival. Nominal GDP growth estimated at 10% for FY27. The key drivers are:
- Domestic Resilience: Low inflation, strong buffers, fiscal consolidation to 4.3% deficit.
- Reforms Boost: New Labour Codes for productivity; India-EU FTA for exports; manufacturing/services scaling.
- Investment Focus: ₹12.2 lakh crore public capex crowding in private funds; infrastructure-led regional growth.
Risks & Outlook
Global fragmentation noted, but India’s reform-resilience path targets Viksit Bharat 2047 with human capital emphasis.
Conclusion
Union Budget 2026-27 charts a youth-led path to Viksit Bharat via ₹12.2 lakh crore capex, infrastructure leaps, green tech funding, and skills push. Fiscal prudence at 4.3% deficit balances growth with inclusion, targeting 7%+ GDP rise amid reforms.
Difference between Regular Budget and Interim Budget
Major differences between Regular Budget and Interim Budget can be seen as follows:
| Regular Budget | Interim Budget |
|---|---|
| Presented during the normal circumstances. | Usually, presented when presenting a Regular Budget is not feasible due to special circumstances, such as the announcement of elections or disruption of the budget cycle. |
Contains a comprehensive financial statement of the government’s finances, including detailed receipts and expenditures for the upcoming fiscal year, as well as the government’s economic policies and priorities. | This is more of a ‘Vote-on-Account’ or a provisional arrangement that allows the government to meet its expenses for a part of the year and usually does not include major policy announcements. |
FAQs on Union Budget
What are the 3 types of budgets?
There are 3 types of government budget – Balanced Budget, Surplus Budget, and Deficit Budget.
What is Economic Survey?
The Economic Survey is an annual document prepared and presented by the Union Ministry of Finance, which provides an outline of the current state as well as prospects of the various sectors of the Indian economy.
What is the difference between the Economic Survey and the Union Budget?
The Economic Survey provides a review of how the economy has performed in the past year. The Union Budget, on the other hand, is an outline of the government’s focus areas and expenditure plans for the upcoming fiscal year.
What is Government Budgeting?
Government Budgeting refers to the process by which governments (whether the central government or the state government) create, manage, and implement their financial plans. It involves estimating government revenues (such as taxes, fees, and grants) and allocating financial resources to different public sectors and activities.
