Union Budget 2026 Expected To Drive Sustainable Growth With Bold Reforms

Updated: December 17, 2025 05:42

Image Source : The Financial Express

Experts anticipate that the Union Budget 2026, to be presented in February, will focus on sustainable growth by shifting emphasis from fiscal deficit targets to the debt-to-GDP ratio. Key expectations include tax simplification, consumption revival, manufacturing support, and infrastructure expansion to achieve GDP growth above 7 percent.

As India prepares for the Union Budget 2026–27, economists and market experts are calling it potentially historic, with the government expected to balance fiscal prudence with bold measures aimed at sustainable growth. Finance Minister Nirmala Sitharaman is likely to present the budget in February 2026, amid global headwinds including trade disruptions, tariff pressures, and geopolitical uncertainties.

Key highlights from expert expectations include

Focus on achieving real GDP growth above 7 percent in FY27 through productive spending.
Shift from rigid fiscal deficit targets to debt-to-GDP ratio, creating fiscal space for infrastructure and social investments.
Simplification of income tax structures, including lower TDS rates, to boost consumption and household savings.
Support for manufacturing, logistics, and capital markets to strengthen India’s private capex cycle.
Increased allocation for MSME modernization, skill development, and sustainability initiatives.
Continued emphasis on digital infrastructure, renewable energy, and green financing to align with long-term climate goals.
Potential measures to deepen financial inclusion and expand credit access for rural and semi-urban areas.

Experts such as Gautam Duggad of Motilal Oswal Financial Services believe the budget could mark a paradigm shift in India’s fiscal approach, prioritizing growth-oriented spending while maintaining discipline. Industry leaders also expect supportive policies for private capital expenditure, particularly in manufacturing and infrastructure, as India enters a new investment cycle.

This budget is being seen as a crucial opportunity to lay the foundation for India’s transition toward a more resilient and sustainable economy. By focusing on consumption revival, investment in infrastructure, and fiscal flexibility, the government aims to position India as a global growth leader despite external challenges.

Sources: Times Now, Times of India, Mint, Moneycontrol

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