Finance minister Nirmala Sitharaman presented the Union Budget for 2026-27 on Sunday, 1 February, against the backdrop of renewed geo-economic disruptions affecting India. With these pressures likely to spill into the coming financial year, the Budget offers a window into how the government plans to respond to a set of pressing challenges.
In this five-part series, we use charts to examine the Budget’s response across 15 key concerns.
This part looks at the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), affordable housing, and tourism. Each topic has a pair of charts—one presenting the context the Budget faced, and the other showing what the Budget delivered.
This part looks at the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), affordable housing, and tourism. Each topic has a pair of charts—one presenting the context the budget faced and the other showing what the Budget delivered.
Rural jobs
Employment generated under the rural employment guarantee scheme has declined this fiscal, slipping from an average of about 50 days seen in recent years. At the same time, the Centre’s budgetary allocation to MGNREGS has remained stagnant over the past two years, even as actual spending exceeds estimates more often than not.
With the new VB-G RAM G Act, or Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin), Act, altering the funding structure and reducing Centre’s share, the scheme’s outlay in the Budget has been sizeable at nearly ₹1.3 trillion. Contrary to expectations, the overall spending on rural job guarantee schemes has gone up substantially for FY27.
Home hurdles
A common person’s aspiration of owning a home is slowly fading in India. Affordable housing has been squeezed out due to rising land prices, escalating construction costs and a ‘premiumization’ trend that saw builders pivot towards luxury homes with higher profit margins in the post-pandemic period. Consequently, there has been a sharp decline in the availability and supply of affordable houses, with the launch-to-sales ratio falling well below 1 and dropping to 0.36 in 2025, signalling acute supply shortages.
During this period, expenditure by the housing and urban affairs ministry has remained largely unmoved, even as demand continues to outpace supply.
Tourism slump
Foreign tourists are giving India a miss, which can directly hit the local economy in many tourist areas. Arrival numbers are likely to stay below pre-pandemic levels in FY26. A stronger international promotion of India as a brand can help lift the inflow in order to compete with global peers in an increasingly competitive market.
Despite an uptick in international publicity spending in FY26,, the tourism ministry has consistently underspent the funds for publicity purposes and has led to smaller allocations with each passing year. Without a robust marketing push, India risks losing its competitive edge in the recovering global travel market.
Read the other stories in the series here: