Budget 2026 Expectations Highlights: Which sectors will Nirmala Sitharaman focus on? What experts expect this year

Budget 2026 Expectations LIVE: Since 1999, the Union Budget for every financial year has been presented at 11 a.m. (IST) as a practice that helps align the announcement with market hours, parliamentary business, and same-day analysis by the stakeholders.

Historically, the Union Budget used to be presented in the evening, at around 5 p.m. (IST) on the last working day of February, since the British colonial era.

Budget 2026 Expectations LIVE: Over the years, the Union Budget of India has evolved from a briefcase to later Bahi Khata, and now in the new digital India as a tablet.

In 2019, Union Finance Minister Nirmala Sitharaman replaced the old ‘budget briefcase’ with a red-colored ‘bahi khata’, giving a desi avatar to her first budget.

During the global pandemic of 2020, the Finance Ministry used the opportunity to go entirely paperless during budget presentation, switching to a tablet instead of a ‘bahi khata.’

India's first digital budget was presented by Finance Minister Nirmala Sitharaman on a digital tablet.

Budget 2026 Expectations LIVE: Ravindra Rai, the Managing Director and CEO of Bobcard Ltd, said that the upcoming Union Budget 2026-27 is set to focus its emphasis on digital payments, cybersecurity, and financial infrastructure in an effort to strengthen the Indian ecosystem.

“From a Budget expectation standpoint, continued emphasis on digital payments, cybersecurity, and financial infrastructure would go a long way in strengthening trust across the ecosystem. These are foundational areas that directly impact how confidently consumers and businesses adopt digital credit,” said the expert.

Ravindra Rai also anticipates a push toward technology investments in secure payment platforms, cybersecurity, virtual and tokenised cards, and UPI-first credit products.

Budget 2026 Expectations LIVE: Rahul Deb Banerjee, Chief Operating Officer, Clarks Hotels & Resorts, explained that the hospitality and tourism industry is seeking continued support in areas such as capital investment incentives, interest support mechanisms, technology adoption, and sustainable practices amid rising travel demand.

“Continued support in areas such as capital investment incentives, interest support mechanisms, technology adoption, and sustainable practices would further reinforce the sector’s growth trajectory and its contribution to employment and economic expansion,” said Banerjee.

The expert also said that as the travel demand continues to rise, affordability and accessibility remain important considerations for sustaining growth.

Banerjee said that the government can support this positive momentum with continued policy facilitation, including infrastructure status, tax rationalisation, and capital investment support.

Budget 2026 Expectations LIVE: Sreeram Ramdas, Vice President at Green Portfolio PMS, said that in the Union Budget 2026-27, the government is expected to balance fiscal aspects with support that addresses the headwinds for MSMEs and export-oriented companies.

“The expectation is for the government to balance fiscal aspects with support that addresses the headwinds for MSME’s and export-oriented companies are facing. A key area of focus should remain infrastructure and capital expenditure,” said the expert.

“While last year’s budget maintained a very high capex outlay, companies across the spectrum that relies heavily on government contracts are struggling, procurement and construction (EPC) ecosystem are now signalling a slowdown due to rising input costs, supply-chain volatility and extended timelines,” said Ramdas.

“Besides sustained public investment, focus on reducing payables timeline to contractors and uniform spending across the year will help reinvigorate this space. This space is crucial given the economic multiplier effect,” he said. “Similarly, the manufacturing and chemicals sectors are seeking targeted support to reduce input costs, including customs rationalisation and calibrated incentives under PLI schemes.”

“In the Budget announcement, there will definitely be a focus to boost the export sector as this part of the economy is absolutely crippled. Signing FTA’s with irrelevant countries is no substitution for exports to the US. One dimension that deserves specific attention is the fishery and marine products industry, which has been under pressure due to recent high tariffs imposed by the United States. These tariffs have shown no impact in Q2 results of the company because they were able to front-load the order during the buffer period,” said the expert.

“Q3 results of these companies will be dramatically saddening. Budget measures such as focused export incentives, freight support and market diversification programmes would be timely for this segment,” he said.

“For the BFSI sector, enhancements to credit flow, bond market development and risk capital frameworks will be key to supporting credit growth and economic resilience. Since 2024, the MFI space has been struggling because of the large provisioning and credit losses, which eventually pushes them to secured lending. Eventually, it’s the rural economy that struggles for credit as a result,” said the industry expert.

“Rather than increasing budget for defence procurement and large commitments to ineffective government schemes, the focus should be pinpointed on improving the crippling sectors of the economy. If we were to announce a mediocre ineffective and diplomatic budget, the result will be continued deflation and a thumping rupee,” said Ramdas.

“In sum, a Budget that sustains infrastructure capex, strengthens export support and enhances sector-specific competitiveness will both bolster domestic growth and signal confidence to investors,” said the industry expert.

Budget 2026 Expectations LIVE: Sumit Gupta, Co-Founder of CoinDCX, said that he, along with the entire virtual digital asset (VDA) sector the Union Budget 2026 are seeking ‘measured relief,’ especially since it has been four years since the current taxation framework was introduced in India.

“As we approach Budget 2026, the virtual digital asset sector is naturally looking for measured relief, especially since it has been four years since the current taxation framework was introduced. The decisions taken now can meaningfully accelerate innovation and help India emerge as a global Web3 & VDA leader,” said the expert.

“A critical first step is ensuring clarity in rules and mandating that all crypto exchanges uniformly implement TDS provisions, which will improve compliance and enhance citizen protection against questionable, non-compliant operators through improved adherence to regulations,” said Gupta.

“Reducing TDS from 1% to 0.01% would retain monitoring while removing the primary incentive for offshore migration, encouraging users to return to Indian platforms and restoring transaction visibility under government oversight. Aligning the 30% capital gains tax with income tax slabs, along with allowing loss offsetting and standard business deductions for Web3 ventures, would help create a stable, transparent, and future-ready ecosystem that supports responsible innovation in India,” he said.

Budget 2026 Expectations LIVE: Piyush Goel, Founder & CEO of Beyond Key, said that he expects the government to increase the allocations to favour vendors who can combine technical expertise with strategic advisory.

“We expect budget allocations to increasingly favour vendors who can combine technical expertise with strategic advisory, ensuring digital investments translate into long-term business value,” said Goel.

On the outlook for 2026, the industry expert said that he anticipates the global tech investment to rise as organisations prioritise digital transformation, data-driven decisioning, and AI-powered automation.

“Organisations are focusing more on integrated ecosystems and secure cloud-native solutions. Budget planning is going towards structured, outcome-oriented digital frameworks in areas like AI regulation, predictive analytics, and real-time data intelligence, shifting away from experimental investments. We anticipate that CIOs will devote a larger amount of their technology budgets, nearly 15-18% more than last year, to modernisation programs targeted at improving resilience, performance, and customer experience. For IT companies, this signals stronger demand for enterprise-grade platforms that deliver measurable ROI and compliance-ready innovation,” said Goel.

“We want to see stronger and sustained support for the healthcare sector, particularly for cancer care, which continues to place a financial and emotional burden on patients and their families. Increased budgetary allocation for cancer screening, early detection programmes, and affordable treatment options can improve outcomes and save countless lives. We also look forward to incentives that promote the adoption of advanced medical technology, reduced import duties on life-saving equipment, and enhanced support for public–private partnerships. Strengthening oncology infrastructure and ensuring that quality cancer care is accessible and affordable across the country should remain a key national priority,” says Uday Deshmukh, Chairman and founder CEO of Onco-Life Cancer Centre.

“We are expecting Budget 2026 support Indian brands that are built on India’s own strengths. Make in India should go beyond manufacturing and include Ayurveda based products, responsible packaging, and stronger retail ecosystems. Ayurveda is not just a tradition but a living science that gives Indian brands a clear global edge. However, brands committed to authenticity and sustainability often face higher costs. Clear policy support can help bridge this gap and encourage more conscious choices. At the same time, strengthening consumer spending and retail growth will allow homegrown brands to scale responsibly. When Ayurveda, sustainability, and Make in India move together, India can create consumer brands that are trusted at home and respected globally,” says Swagatika Das, CEO and co-founder of Nat Habit.

“Any development in the infrastructure space will help create jobs. Government allocations to develop industrial parks and promote public-private partnerships will be appreciated. If the government is looking for sectors to raise productivity, tourism, agri-processing, horticulture, and floriculture, may be sectors they can consider additional allocation in. For rural employment, additional allocations for MGNREGA may be considered,” says Sajai Singh, Partner at JSA Advocates & Solicitors.

““From 2026 onward, carbon intensity will increasingly function as a trade parameter rather than a sustainability disclosure, particularly with mechanisms like the EU’s Carbon Border Adjustment Mechanism coming into force. For Indian exporters, competitiveness will depend on the ability to provide granular, verified emissions data with clear audit trails that link carbon performance to physical goods. A well-structured domestic carbon pricing and measurement ecosystem can soften CBAM exposure, reduce the risk of double taxation, and help Indian industry compete in carbon-constrained markets. Policymakers should focus on alignment. India’s carbon market architecture must meet global standards for verification and traceability so that decarbonisation becomes a trade advantage instead of a trade barrier,” says Yashodhan Ramteke, CEO, EcoGuard.

“India’s economy has quietly become service-dominant, but our fiscal structures haven't caught up with that reality. We have built the 'digital rails,' but the fixed cost of operating on them for businesses built on expertise, platforms, and IP, is disproportionately high. As we look toward 2026, we are looking for a roadmap that moves beyond simple incentives and starts de-risking long-term intellectual capital. My expectation from the Budget is a shift in focus toward the 'Real Economy,' where policy explicitly recognizes intellectual investment as an engine of productivity,” says Tamanna Khanna Co-founder, Agram Konnect.

“In view of the turbulent geopolitical environment, the Government is expected to provide added incentives for exports which may improve overall economic performance and offset trade uncertainties,” says Smita Singh, Partner ( Indirect Tax ) at S&A Law Offices.

“The government has laid a strong foundation for India’s renewable energy sector through consistent policy support and sustained capacity addition. To further strengthen the sector, the upcoming Union Budget must announce additional measures aligned with India’s climate commitments and global competitiveness. Priority should be given to incentivizing investments in green hydrogen, grid-scale energy storage, modernization of transmission infrastructure, and introducing targeted PLIs or tax incentives to enhance energy security and build alternative material ecosystems. Together, these steps can reduce risk, improve grid reliability, and enable renewables to scale in a more efficient and commercially sustainable manner,” says Srivatsan Iyer, Global CEO of Hero Future Energies.

“As the 2026 Union Budget approaches, the sector is hoping for clear support for digital education and the creation of high quality regional content, so these platforms can reach even the most remote parts of the country. There is also an expectation that the government will address gaps in connectivity and encourage online skill building initiatives in underserved areas. Focused support for AI first learning platforms can help raise communication standards nationwide. With the right budgetary priorities, digital education can play a key role in closing the employability gap and preparing India’s workforce to compete confidently on a global stage,” says Arpit Mittal, Founder and CEO at SpeakX.ai.

“A continued push on large-scale infrastructure creation, urban regeneration, and planned city development will be essential to attract long-term domestic and global investment. With the right policy signals, real estate can play a far larger role in employment generation, formalisation of the sector, and the creation of globally competitive urban centres in the coming fiscal year,” says Robin Mangla, President, M3M India.

“From a developer’s perspective, Pune remains structurally well-positioned for steady growth, supported by infrastructure expansion, employment generation, and consistent end-user demand. To further strengthen the ecosystem, developers look to the government for faster and more predictable approval processes, greater clarity on development control regulations, and continued investment in last-mile infrastructure and public transport. Rationalisation of taxes and fees, incentives for sustainable construction, and support for affordable and mid-income housing would also help deepen demand. With policy stability and infrastructure-led growth, Pune can continue to evolve as one of India’s most resilient and investment-worthy residential markets,” says Aakash Agarwal, Managing Director, Krisala Developers.

“The upcoming Union Budget presents an important opportunity to further strengthen the operating environment for the QSR and food services sector. Measures that simplify compliance, support ease of doing business, and ensure a more predictable cost structure would go a long way in enabling sustainable growth for homegrown brands. From an industry perspective, rationalisation of GST and exemption from payment of GST under RCM on renting of immovable property from unregistered persons, smoother access to input tax credits, especially on rentals, supply chain, and essential operating expenses, would meaningfully reduce cost pressures and improve unit economics for QSR operators,” says Ajaypal Rathore, CFO, Burger Singh.

"What now needs attention is the execution layer. Scaling deeptech and manufacturing businesses requires support through long development cycles involving certification, validation, extended pilots and early deployments, especially in sectors where reliability, safety and trust determine adoption… For this momentum to translate into sustained outcomes, the Union Budget must reinforce this execution ecosystem through shared testing and certification infrastructure, predictable regulatory pathways, and incentives aligned with longer gestation timelines. Such signals also help bring more domestic institutions and family offices into deeptech investing, ensuring that India’s innovation progress converts into durable industrial capability and long-term value creation.” says Ankit Kedia, Founder and Lead Investor, Capital-A.

“For the construction equipment industry, we expect demand recovery to be led by rising private capex, expanding export opportunities, defence applications, and sustained investments in airports, railways and freight corridors. Supportive policy measures, including GST rationalisation, easing interest rates and improved liquidity, will be further vital to crowd in private investment and strengthen industry confidence. As project execution accelerates, visibility across equipment categories will improve, alongside deeper adoption of digital technologies such as telematics and predictive analytics. By prioritizing these strategic initiatives, the government can pave a thriving and inclusive future, contributing to India's role in the global economy,” says Rajan Luthra, CFO, Action Construction Equipment

“Government backing for local material sourcing, skill enhancement, and retail expansion in Tier II and Tier III towns will open up the next growth phase for Indian fashion brands. A realistic and growth-oriented budget will enable brands like ours to offer high-quality clothing experiences to Indian consumers at competitive prices, all the while developing their own sustainable and responsible businesses,” says Vishal Mehra, co-founder of Stylox Fashion.

“Union Budget 2026 presents a timely opportunity to accelerate the next phase of growth for this vital sector. We welcome the government’s continued support on the GST front and believe there is scope for further rationalisation of key inputs such as packaging material, refrigeration equipment, animal feed and veterinary services. This would go a long way in easing rising cost pressures and improving overall efficiency across the value chain,” says K Rathnam, Whole Time Director and CEO of Milky Mist Dairy Food.

“As the Union Budget FY2026 approaches, the education sector anticipates progressive reforms that enhance quality, inclusivity, and global competitiveness. A strong focus on higher education funding, research-led universities, and outcome-based learning will be vital. Emphasis on skill development, employability, and robust industry-academia collaboration can help align graduates with emerging workforce needs. Investments in digital learning, AI, and advanced technologies will accelerate innovation-driven education. Supportive and enabling policies for private and deemed universities will empower institutions to scale impact, foster research excellence, and contribute meaningfully to India’s knowledge economy,” says Koneru Satyanarayana, Chancellor, KL Deemed to be University.

“As we look at Budget 2026, we need to make water our national priority, not just a state subject. Just like highways connected the country economically, we now need “water highways” to move surplus water to drought-hit regions… Climate change is not just an environmental issue. It is a basic needs issue. And only large-scale government intervention can solve it,” says Amit Banka, founder and CEO of WeNaturalists

“As India looks ahead to the Union Budget FY2026, the renewable energy sector expects strong policy continuity and enhanced incentives to accelerate the nation’s clean energy transition. Increased support for solar infrastructure, domestic manufacturing, and grid-scale as well as decentralized solutions will be critical to achieving India’s sustainability and energy security goals. Budgetary focus on ease of doing business, financing access for MSMEs, and innovation in energy storage and smart grids can further strengthen industry growth. A stable, forward-looking policy framework will empower companies to scale solar adoption and drive long-term environmental and economic impact,” according to Akshat Jain, CEO of KLK Ventures.

“The Government has demonstrated a clear and consistent commitment through its National Action Plan for Toys, reinforcing confidence within the industry. The 2025 Budget further strengthened this momentum — bringing renewed optimism with its focused thrust on transforming India into a global hub for high-quality, self-sufficient toy manufacturing. The recent reports of a proposed incentive program with an estimated outlay of ₹13,000 crore (approximately USD 1.5 billion) under a potential Production Linked Incentive (PLI) scheme further underscore a strong policy commitment to the sector’s growth. We are eagerly awaiting further developments in the upcoming Union Budget, whether through the PLI scheme or other targeted manufacturing incentives as such initiatives will play a pivotal role in fostering toy manufacturing clusters, enhancing workforce skills, and building a sustainable ecosystem for producing globally competitive toys that truly embody the spirit of the ‘Made in India’ brand,” says Aditya Krishnakumar, co-founder at BIDSO.

“We expect the Budget to advance initiatives and incentives that improve MSME credit access and accelerate green economy investments aligned with India’s SDG priorities. MSMEs account for ~30% of GDP, ~45% of exports, and over 20 Cr. jobs, yet face a credit gap exceeding ₹20 lakh crore. Addressing this through credit impetus and compliance rationalisation can materially lift employment and export competitiveness. Increased policy support for renewables, green mobility, and clean cooking sectors, which together represent $50Bn+ in annual investment potential, will strengthen medium to long term economic and climate resilience and meet our national green targets for 2030,” says Neha Juneja, founding member at IndiaP2P and EquiRize

“The recent change in the GST Exemption has made the Indian population aware of the importance of insurance in their life, but with the Union Budget coming soon, the insurance stakeholders will be expecting more from the Government in terms of deep structural reforms, which should not just be symbolic changes, but accelerate penetration, improve affordability, and strengthen consumer protection. Measures such as tax incentives for risk protection, micro-insurance support, distribution reforms, reduction of consumer grievances, and policy clarity on long-pending reforms like composite licensing are seen as key levers to sustain momentum,” says Ankita Srivastava, General Manager – Growth & Strategy at The Healthy Indian Project.

“The basic exemption limit of ₹4 lakh should be enhanced to ₹6 lakh for salaried employees. The new tax regime has removed most of the deductions and exemptions available under the old regime, such as Sections 80C and 80D for medical insurance premiums. This move has discouraged investments in tax-saving instruments. Although employees without business income are allowed to switch between the old and new tax regimes every year, this option should also be extended to employees with business income. At present, they are permitted to switch only once,” says CA Deepak Ukidave, Adjunct Faculty - Finance & Law, at K J Somaiya Institute of Management.

“Having successfully achieved E20 blending ahead of schedule, India now faces a productive surplus that requires urgent demand-side policy innovation. Budget 2026 should focus on incentivizing E100-ready infrastructure and accelerating the mandate for Sustainable Aviation Fuel (SAF) to absorb this additional ethanol capacity. It will lead to a strategic shift toward ethanol-to-chemicals and high-value bio-based derivatives is essential. This budget must provide the fiscal framework to transition from fuel blending to a global leadership role in the Sustainable Chemical economy,” says Dr Sangeeta Srivastava, Executive Director at Godavari Biorefineries

The upcoming Union Budget 2026 is expected to be a key trigger for the industrial sector, with higher government allocation likely to support a recovery in domestic ordering, particularly for infrastructure and capital goods companies, according to a report by HDFC Securities Institutional Research.

The report highlighted that road awards by the National Highways Authority of India (NHAI) have remained subdued so far in FY26, raising expectations that the Budget could provide additional support to revive project awarding.

In a bid to strengthen India's gem and jewellery competitiveness amid a challenging trade landscape, the gems and jewellery sector has sought targeted duty rationalisation, procedural reforms and reduction in GST in the upcoming Union Budget 2026-27.

The Gem and Jewellery Export Promotion Council (GJEPC), in its pre-Budget recommendations to Finance Minister Nirmala Sitharaman, has made several proposals to make Indian exports more cost-efficient and position India as a diamond trading and value-discovery centre.

The government is unlikely to unveil any major "big ticket" direct tax reforms in the Union Budget for 2026, as the Centre has already implemented the most significant changes through the new Income Tax Act, Deloitte India Partner Sumeet Hemkar said on Wednesday.

"I feel the big ticket direct tax reform has already happened, which is in the form of the new Income Tax Act that we have now," Hemkar told ANI in an exclusive interview. "That was the big ticket item which the government has already put into effect."

Finance Minister Nirmala Sitharaman is going to present Budget 2026. This is the ninth straight time she is presenting the Union Budget.

Budget 2026 is set to be presented on 1 February. This is the first time in India's history that the Union Budget is being presented on a Sunday.