New Delhi: The Union Budget 2026–27 emphasises policy continuity, fiscal prudence, and investment-led growth.
India’s macroeconomic fundamentals remain strong, with growth indicators robust and fiscal targets achieved with relative ease.
As noted in the Economic Survey 2025–26, GDP growth for 2025–26 is estimated at 7.4 per cent, while growth for 2026–27 is projected at 6.8 to 7.2 per cent.
Against this backdrop, the Budget seeks to sustain the current growth momentum while strengthening the foundations for medium- and long-term expansion.
Among the six key areas identified to accelerate and sustain growth, scaling up manufacturing in strategic sectors occupies a prominent place. This approach builds on earlier initiatives aimed at strengthening domestic production capabilities and improving India’s integration into global value chains, according to an article by Durgesh Rai on news portal PRF.
The launch of India Semiconductor Mission (ISM) 2.0 marks a significant step in this direction.
Building on ISM 1.0, the new mission focuses on developing domestic capacities in semiconductor equipment and materials, designing full-stack Indian intellectual property, and strengthening supply-chain resilience.
It also envisages industry-led research and training centres to foster technological capability and develop a skilled workforce.
Complementing this initiative, the outlay for the Electronics Components Manufacturing Scheme, introduced in April 2025, has been increased to Rs 40,000 crore, signalling the government’s intent to scale up electronics manufacturing ecosystems in the country, the article states.
The Budget also advances India’s strategic minerals agenda. Taking forward the Scheme for Rare Earth Permanent Magnets launched in November 2025, it proposes targeted support for mineral-rich states, Odisha, Kerala, Andhra Pradesh, and Tamil Nadu, to establish dedicated Rare Earth Corridors. These corridors aim to promote integrated development across mining, processing, research, and manufacturing, thereby reducing import dependence and strengthening downstream industries.
The article also highlights that beyond high-technology manufacturing, the Budget outlines a broader set of interventions to sustain growth. These include rejuvenating legacy industrial sectors, creating ‘Champion MSMEs’, a renewed push for infrastructure development, measures to ensure long-term energy security and stability, and developing City Economic Regions to harness urban agglomeration economies.
Besides, the Budget also proposes introducing strong incentives to attract global business and investment to India. For instance, a tax holiday will be available until 2047 for any foreign company that provides cloud services to customers globally using data centre services in India.
Also, to boost manufacturing in the country, the proposal is to provide a “5-year tax exemption to any non-resident who provides capital goods, equipment or tooling to any toll manufacturer in a bonded zone.”
Given their employment imperative, several labour-intensive sectors have received special emphasis. For instance, the Budget adopts a three-pronged strategy to support MSMEs through equity support, liquidity support, and professional support. Similarly, an integrated programme will be launched for the textile sector.
At the macro level, fiscal prudence remains a key feature of Budget 2026–27. The government continues to manage the fiscal deficit carefully, balancing growth-supportive expenditure with medium-term fiscal consolidation objectives.
Overall, the Union Budget 2026–27 reinforces a strategy of sustaining growth through investment-led expansion, manufacturing competitiveness, and incremental reforms, while maintaining macroeconomic stability, the article observes.
(IANS)
