the foundation is clear. this budget centers on three kartavyas: sustaining structural reforms, building a resilient financial sector, and deploying technology for better governance. the aim is simple. transform aspiration into achievement, potential into performance.
india's economic trajectory holds steady. we're looking at growth rates around 7%, moderate inflation, and fiscal discipline. the government reduced critical import dependencies while strengthening domestic manufacturing capacity. energy security remains a priority. citizens benefit from these actions through sustained stability and momentum.
manufacturing gets a major push
the strategy here targets strategic and frontier sectors. we're talking about 200 legacy industrial clusters getting revived. biopharma shakti, electronics components manufacturing, and the india semiconductor mission 2.0 will expand domestic production capabilities.
textiles receive integrated support. three dedicated chemical parks will enhance production. container manufacturing gets its own scheme. rare earth permanent magnets will see research, mining, processing, and manufacturing support. affordable sports goods production becomes a dedicated initiative. cpses will establish hi-tech tool rooms.
the tax reforms support this shift. manufacturers in bonded zones get income tax exemptions for five years. component warehousing receives safe harbour provisions. trusted manufacturers access deferred duty payment windows. seafood processors can import duty-free inputs up to 3% of export value, up from 1%. leather and textile garment exporters get extended timelines, moving from 6 months to 1 year. microwave oven parts and aircraft components arrive duty-free.
regular importers with trusted supply chains receive recognition in the risk system. export cargo using electronic sealing moves directly from factory premises to ship. special measures let sez manufacturing units sell in the domestic market at concessional duty rates.
msmes receive three-pronged support
small enterprises get equity support through a ₹10,000 crore sme growth fund. the self-reliant india fund adds ₹2,000 crore. cpses must now use treds as their transaction settlement platform for all msme purchases, setting a benchmark for other corporates.
treds receives additional backing. invoice discounting gets credit guarantee support through cgtmse. gem links with treds to encourage cheaper, quicker financing. treds receivables become asset-backed securities, developing a secondary market and enhancing liquidity.
professional institutions will develop corporate mitras in tier-ii and tier-iii towns. these help msmes meet compliance requirements at affordable costs. the value cap of ₹10 lakh per consignment on courier exports is removed.
services sector receives renewed focus
a high-powered education to employment and enterprise standing committee will focus on services as a core driver of development. medical value tourism gets five state-run hubs in partnership with private players.
allied health professionals receive upgraded institutions across ten disciplines. the budget trains 1.5 lakh multiskilled caregivers through nsqf-aligned programmes.
ayush expands with three new all india institutes of ayurveda. pharmacies and drug testing labs upgrade for higher certification standards. the who global traditional medicine centre receives support.
the orange economy gains attention. avgc content creator labs arrive in 15,000 secondary schools and 500 colleges. a new national institute of design will serve the eastern region through the challenge route.
sports infrastructure grows through khelo india mission. this includes integrated talent development pathways, systematic coaching development, science and technology integration, and infrastructure development.
education sees five university townships near major industrial and logistic corridors. every district gets a girls' hostel in higher education stem institutions. four telescope infrastructure facilities receive setup or upgrades.
tourism welcomes the national destination digital knowledge grid to document significant places digitally. mountain trails, turtle trails, and bird watching trails develop in select states with ecological sustainability. india hosts the first ever global big cat summit. fifteen archeological sites transform into vibrant, experiential cultural destinations. a pilot scheme upskills 10,000 guides across 20 iconic tourist sites. a national institute of hospitality bridges academia, industry, and government.
buddhist circuits in the north east region receive development support.
information technology services receive streamlined treatment. services club under a single category with a common safe harbour margin of 15.5%. the safe harbour threshold for it services rises from ₹300 crore to ₹2,000 crore. approval happens through automated rule-driven processes. companies choose safe harbour continuation for five years.
unilateral apa processes for it services aim to conclude within two years, with possible six-month extensions. modified returns extend to associated entities of apa-availing entities.
foreign companies providing cloud services through india-based data centres get tax holidays until 2047. related entities providing data center services from india receive a 15% safe-harbour on cost. global income of expert stays for 5 years under notified schemes.
financial sector restructures
municipal bonds of more than ₹1,000 crore receive ₹100 crore incentives for single issuance. the current amrut scheme continues. power finance corporation and rural electrification corporation undergo restructuring.
fema non-debt instruments rules receive comprehensive review. corporate bonds welcome market making frameworks and total return swaps.
a high level committee on banking for viksit bharat aligns the sector with india's next growth phase.
stt on futures rises from 0.02% to 0.05%. stt on options premium and exercise climbs to 0.15% from 0.1% and 0.125% respectively.
agriculture and allied sectors advance
fisheries receive support through integrated development of 500 reservoirs and amrit sarovars. coastal fisheries value chains strengthen. market linkages enable start-ups, women-led groups, and fish fpos.
fish catch by indian vessels in the exclusive economic zone or high seas becomes duty-free. landing such fish on foreign ports counts as export of goods.
sandalwood gets focused cultivation and post-harvest processing support.
high-value agriculture expands. the coconut promotion scheme increases production and enhances productivity. indian cashew and cocoa programmes receive dedicated attention. entrepreneurship in the sector facilitates rural and peri-urban job creation. loan-linked capital subsidy supports establishment of veterinary and para-vet colleges, hospitals, diagnostic laboratories, and breeding facilities in the private sector.
horticulture sees rejuvenation of old, low-yielding orchards. high-density cultivation expands for walnuts, almonds, and pine nuts.
bharatavistaar integrates agristack portals and icar agricultural practices with ai systems.
primary cooperative societies engaged in supply of cattle feed and cotton seed produced by members receive deduction allowances. inter-cooperative society dividend income qualifies as deduction under the new tax regime when distributed to members. dividend income received by notified national co-operative federations from investments made in companies up to 31.1.2026 gets three-year tax exemption, provided dividends distribute to member co-operatives.
infrastructure receives massive backing
public capital expenditure reaches ₹12.2 lakh crore in fy27, up from ₹2 lakh crore in fy15. invits, reits, niif, and nabfid enable large-scale infrastructure enhancement. development continues in tier ii and tier iii cities with populations over 5 lakh.
the infrastructure risk guarantee fund provides prudently calibrated partial credit guarantees to lenders. cpse real estate assets recycle through dedicated reits. new dedicated freight corridors connect dankuni in the east to surat in the west.
twenty new national waterways operationalise, connecting mineral-rich areas, industrial centres, and ports. ship repair ecosystems develop for inland waterways. the coastal cargo promotion scheme targets increasing the share of inland waterways and coastal shipping from 6% to 12% by 2047. a seaplane vgf scheme indigenises manufacturing.
states receive ₹2 lakh crore support under the sasci scheme. purvodaya develops the integrated east coast industrial corridor.
energy security strengthens
a scheme to adopt carbon capture utilization and storage receives ₹20,000 crore. basic customs duty exemption extends to capital goods for lithium-ion cell manufacture in battery energy storage systems. sodium antimonate for solar glass manufacturing imports duty-free. nuclear power projects receive extended bcd exemption on required goods until 2035, expanding to all nuclear plants regardless of capacity. capital goods for critical minerals processing in india arrive duty-free. biogas blended cng excludes the entire biogas value from central excise duty.
urbanisation through city economic regions
the focus amplifies the economic power of agglomerations in tier ii, tier iii cities, and temple towns. seven high-speed rail corridors become growth connectors: mumbai-pune, pune-hyderabad, hyderabad-bengaluru, hyderabad-chennai, chennai-bengaluru, delhi-varanasi, varanasi-siliguri. these environmentally sustainable passenger systems reshape connectivity.
people-centric development expands
a strong care ecosystem covers geriatric and allied care services, training 1.5 lakh multiskilled caregivers.
she marts establish as community-owned retail outlets within cluster level federations.
divyangjan kaushal yojana provides dignified livelihood opportunities through industry-relevant training customized to disability groups. divyang sahara yojana ensures timely access to high-quality assistive devices for all eligible. alimco scales production, invests in r&d and ai integration. pm divyasha kendras strengthen as modern retail-style centres.
nimhans-2 gets established. national mental health institutes in ranchi and tezpur receive upgrades. emergency and trauma care centres arrive in district hospitals.
trust-based governance reforms
tier 2 and tier 3 authorised economic operators see duty-deferral periods extend from 15 to 30 days. eligible manufacturer-importers access the same facility. government agencies leverage aeo accreditation.
advance ruling validity extends from 3 years to 5 years. filing bill of entry by trusted importers and goods arrival automatically notify customs. the customs warehousing framework transforms into a warehouse operator-centric system with self-declarations.
ease of doing business and living improves
individual persons resident outside india can invest in equity instruments of listed indian companies through the portfolio investment scheme.
interest awarded by motor accident claim tribunals to natural persons becomes exempt from income tax. tds on this account ends.
tcs rates reduce. overseas tour program packages drop from 5% and 20% to 2% with amount stipulations removed. education and medical purposes under liberalized remittance scheme fall from 5% to 2%. supply of manpower services sees tds at either 1% or 2%.
obtaining lower deduction certificates happens through rule-based automated processes for small taxpayers. depositories accept form 15g or form 15h from taxpayers holding securities in multiple companies.
return revision time extends from 31st december to 31st march with nominal fees. individuals with itr 1 and itr 2 returns continue filing till 31st july. business cases or trusts get time till 31st august.
tds on immovable property sales by residents happens through resident buyer's pan instead of tan.
a one-time 6-month foreign asset disclosure scheme opens for small taxpayers below a certain size. taxpayers update returns even after reassessment proceedings begin at an additional 10 percent tax rate. immunity from penalty and prosecution for underreporting extends to misreporting. books of account production and tds payment requirements become decriminalised.
prosecution immunity applies retrospectively from 1.10.2024 for assets under ₹20 lakh. minimum alternate tax exemption extends to all presumptive-basis taxpayers.
a joint committee of ministry of corporate affairs and central board of direct taxes incorporates icds requirements in indas. tax buyback applies to all shareholders as capital gains, with promoters paying additional buyback tax. mat credit set-off allows up to 1/4th of tax liability in the new regime. mat becomes final tax.
seventeen cancer drugs or medicines receive bcd exemption. a single, interconnected digital window handles cargo clearance approvals. customs integrated system rolls out in 2 years. honest taxpayers settling disputes close cases by paying additional amounts instead of penalties.
fiscal consolidation continues
the 16th finance commission recommends retaining the vertical share of devolution at 41%. states receive ₹1.4 lakh crore in fy27 as finance commission grants, including rural and urban local body and disaster management grants.
the central government targets a debt-to-gdp ratio of 50±1 percent by 2030. be 2026-27 estimates 55.6 percent, compared to 56.1 percent in re 2025-26. re 2025-26 fiscal deficit matches be at 4.4 percent of gdp. be 2026-27 estimates fiscal deficit at 4.3 percent of gdp.
where the money flows
every rupee collected comes from corporation tax (18%), income tax (21%), customs (4%), union excise duties (6%), gst and other taxes (15%), and transfers to states (22%). borrowings and liabilities account for 24%, with smaller contributions from capital receipts and other revenues.
every rupee spent goes to states' share of taxes (22%), interest payments (20%), defence (11%), central sector schemes (17%), major subsidies (6%), finance commission and other transfers (7%), centrally sponsored schemes (8%), civil pension (2%), and other expenditures (7%).
receipts reach ₹41.3 lakh crore in be 2026-27. expenditures total ₹53.4 lakh crore. effective capital expenditure stands at ₹17.1 lakh crore.
centre's net tax revenue grows from ₹18.7 lakh crore in 2022-23 to ₹26.2 lakh crore in be 2026-27. total transfer to states and uts rises accordingly. the trends show consistent growth across revenue streams.
major expenditure items include transport (₹5,98,520 crore), defence (₹5,94,585 crore), rural development (₹2,73,108 crore), home affairs (₹2,55,234 crore), agriculture and allied activities (₹1,62,671 crore), education (₹1,39,289 crore), energy (₹1,09,029 crore), health (₹1,04,599 crore), urban development (₹85,522 crore), it and telecom (₹74,560 crore), commerce and industry (₹70,296 crore), social welfare (₹62,362 crore), scientific departments (₹55,756 crore), tax administration (₹45,500 crore), external affairs (₹22,119 crore), finance (₹20,649 crore), and development of north east (₹6,812 crore).
the path forward
this budget balances ambition with inclusion. action wins over ambivalence. reform takes precedence over rhetoric. people matter more than populism.
the vision is clear. transform india through sustained growth, reduced dependencies, structural reforms, and fiscal prudence. the government invests in public infrastructure, builds domestic manufacturing capacity, and ensures energy security.
every measure aims to enhance productivity, build resilience, and develop people's capacity. every family, community, region, and sector gains access to resources, amenities, and opportunities for meaningful participation.
the economy stands ready. the foundations strengthen. the people lead.
read the official notification https://urls.ibbe.in/doq6jk
