Budget Highlights 2026: Finance Minister Sitharaman makes big announcements on STT, tourism, manufacturing, MSMEs

The Indian tyre industry stands to gain from the government's steps to enhance spending on infrastructure announced in the Union Budget 2026-27, Automotive Tyre Manufacturers Association (ATMA) said on Monday.

"The tyre industry's growth is intrinsically linked to the pace of infrastructure expansion in the country. The government's focus on elevating public capex reinforces demand momentum for tyres across both passenger and commercial vehicles," ATMA Chairman Arun Mammen said.

India's medium-term macro outlook remains constructive as the Union Budget for FY27 signals continuity in capital expenditure alongside a softer fiscal drag, according to a report by Goldman Sachs.

The Goldman Sachs report said: "the FM reaffirmed the commitment to keep central government public debt (as a share of GDP) on a declining path toward 50% ( /- 1%) by FY31 (from 55.6% target in FY27). We see this as an important signal, given India's relatively elevated public-debt burden versus most EM peers."

Indian Council of Medical Research (ICMR) Director General Rajiv Bahl said the government has initiated a significant push to transform the country's pharmaceutical landscape by addressing regulatory gaps and enhancing research infrastructure.

Bahl told ANI: "A big step has been taken to overcome the shortcomings in the regulator in the pharma sector."

The three-time increase in allocation for the Production Linked Incentive (PLI) scheme for automobiles and auto components in the Union Budget 2026 is likely to significantly support electric vehicle (EV) penetration and localisation of component manufacturing.

In the Budget, the allocation under the PLI scheme for automobiles and auto components has been increased threefold to ₹59.4 billion for FY27, compared to ₹20 billion in FY26.

Finance minister Nirmala Sitharaman on Sunday announced setting up of an infrastructure risk guarantee fund to ease financing bottlenecks and revive stalled projects.

Read all about it here

Finance Minister Nirmala Sitharaman, in her Union Budget 2026 speech on Sunday, 1 February, announced a one-time foreign asset disclosure scheme for small taxpayers like students, tech professionals, and relocated Non-Resident Indians (NRIs).

Read all about it

Under the Budget 2026 proposal, FM Nirmala Sitharaman has announced that Self-Help Entrepreneur (SHE) Marts will be set up as community-owned retail outlets within cluster-level federations.

The initiative aims to create stronger market access for enterprises set up by women residing in rural areas, and giving local products a more visible space.

It is also intended to help women business owners reach larger markets, build their brands and create steadier sources of income, while strengthening local institutions such as self-help groups.

On the capital markets front, the Budget has introduced a market making framework, providing access to fund and derivatives on corporate bonds total return swaps, and permission to Persons Resident Outside India for making direct investment in listed equities.

“These initiatives are expected to significantly deepen market participation and improve liquidity,” said Sunil Badala, National Head of Tax, KPMG in India.

However, he added the increase in STT on derivatives may dampen the sentiment in the trading community. In order to curb the F&O frenzy the Finance Minister Nirmala Sitharaman has proposed to increase the Securities Transaction Tax (STT) on the Futures and Options transactions.

In the Union Budget 2026-27, the government proposed measures to reduce prices of leather products, cancer drugs and seafood by extending policy support, allowing duty-free imports and granting customs exemptions, with the objective of strengthening domestic industries while easing costs for patients and producers.

Meanwhile, trading activity and some corporate cash-distribution mechanisms are expected to turn more expensive due to proposed revisions to buyback taxation, the securities transaction tax (STT), and tax collected at source (TCS), indicating a stricter approach toward tax arbitrage and compliance.

Check full list here

The Budget places particular emphasis on export-oriented sectors such as marine products, leather and textiles. To support seafood exports, Sitharaman proposed raising the limit for duty-free imports of specified inputs used for processing seafood products from 1% to 3% of the previous year’s export turnover.

This announcement comes as India faces hefty tariffs in the United States, prompting the government to step up support for exporters. In August, the Trump administration imposed 50% tariffs on New Delhi, including a 25% penalty for purchasing Russian oil.

Commenting on the announcement, SR Patnaik, Partner and head of taxation at Cyril Amarchand Mangaldas said, “the export-linked relaxations for marine, leather, and textile sectors are fiscally modest but strategically sharp; they lower working capital friction while signalling that India intends to compete on speed, scale, and predictability in global value chains.”

The Union Budget 2026 said that the Government will support States, through challenge route, in creating 5 University Townships in the vicinity of major industrial and logistic corridors.

These planned academic zones will host multiple universities, colleges, research institutions, skill centres and residential complexes.

In another announcement, Sitharaman also proposed an ‘orange economy’ to foster a strong support for India's creative industries, creating future-ready creative jobs.

The government will also set up a new National Institute of Design (NID) in the eastern region of India.

“The budget has shifted focus to workforce readiness from capacity creation. The proposal to set up university townships within industrial and logistics corridors will enable closer integration of education, research and industry requirements, as well as encourage targeted investments in gender-inclusive infrastructure, thereby addressing long-standing access constraints in higher education. Along with promoting investments in design and frontier research, the proposals will deepen India’s innovation pipeline and future-skills ecosystem,” said Binaifer Jehani, the Business Head of Assessments at Crisil Intelligence on Education Sector.

In a significant taxpayer-friendly reform announced in the Union Budget 2026–27, Finance Minister Nirmala Sitharaman on Sunday proposed extending the deadline for filing revised income-tax returns (ITRs) from 31 December to 31 March of the relevant financial year, on payment of a nominal fee.

The change, to be implemented under the forthcoming Income Tax Act, 2025, is aimed at improving voluntary compliance and reducing avoidable disputes.

The Finance Minister Nirmala Sitharaman did not announce any new changes in income tax slabs this year, while though she proposed exemptions on duties for several goods.

Union Finance Minister Nirmala Sitharaman announced in the Union Budget 2026 on Sunday a comprehensive scheme to strengthen the Central Drugs Standard Control Organisation (CDSCO), while also announcing a Biopharma Shakti scheme with ₹10,000-crore outlay over the next five years.

“The announcement of Biopharma Shakti is a decisive step towards strengthening India’s pharmaceutical and biopharma ecosystem more structurally,” said Yogesh Mudras, the Managing Director of Informa Markets in India.

For the pharma sector, this initiative goes beyond funding, according to Mudras, as he claimed that it creates a long-term framework to support research, scale up advanced manufacturing, and drive innovation across biologics, biosimilars, vaccines and complex therapies.

Meanwhile, Biplab Lenin, Partner at Cyril Amarchand Mangaldas, said that the proposed ₹10,000 crore investment over the next five years, alongside faster clinical trial approvals and the expansion to 1,000 trial sites, has the potential to significantly strengthen India’s bio-pharma and biosimilars ecosystem, particularly in addressing the growing burden of diabetes and cancer.

“With effective implementation, the initiative can improve access to advanced therapies and further reinforce India’s position as a trusted and reliable global healthcare partner,” he said.

In order to support rare earth minerals, the Union Budget has dedicated Rare Earth corridors to be formed for Odisha, Kerala, Andhra Pradesh and Tamil Nadu, finance minister Nirmala Sitharaman said in her Budget 2026 speech.

The announcement follows the Union cabinet’s approval in November 2025 of a ₹7,280-crore fund to support the domestic production of rare-earth magnets. The fund will back the establishment of five manufacturing plants and provide sales-linked incentives for every kilogramme of magnets sold.

India has one of the world’s largest rare-earth deposits, estimated at about 6.9 million tonnes.

Presenting her ninth consecutive Budget on Sunday, FM Nirmala Sitharaman proposed to hike the Securities Transaction Tax (STT) on futures and options (F&O) trading.

Here's an overview of the proposed changes:

— Futures: STT hiked to 0.05% from 0.02%

— Options premium: An increase in STT to 0.15% from 0.1%

— Exercise of options: STT increased to 0.15% from 0.125%

“This is a ‘Compliance-First’ budget. The sharp hike in STT and the buyback tax realignment are clear deterrents against retail derivative frenzies and promoter-led arbitrage,” said Rohit Jain, Managing Partner at Singhania & Co.

However, he added, that the silver lining lies in the FEMA (NDI) review and the increased NRI investment headroom, which will likely simplify inbound capital structures.

Here's an analysis from Bank of Baroda about the borrowing and bond market after the Budget announcement:

— Gross market borrowing pegged at ₹17.2 lakh crore, slightly higher than market expectations.

— Net borrowings remain stable, offering comfort to bond markets.

— Yield curve may witness a flattening bias due to higher short- and long-term issuances.

India's capital expenditure continues to increase. As announced by the FM Sitharaman, the government will spend ₹12.2 trillion in 2026-27, as against the 2025-26 budget estimate of ₹11.2 trillion.

This is the “highest-ever capital expenditure and works out to be 4.4% of GDP,” according to Sitharaman, adding that this hike is aimed at continuing the momentum in infrastructure development and supporting economic growth.

“The continued expansion of public capital expenditure reinforces the government’s long term commitment to infrastructure-led growth. The proposed Infrastructure Risk Guarantee Fund is particularly significant, as prudentially calibrated credit guarantees can materially de-risk the construction phase for lenders and crowd in private capital. Equally, the accelerated monetisation of CPSE real estate assets through dedicated REITs signals a more mature, institutional approach to asset recycling. Together, these measures strengthen confidence across the infrastructure and real estate value chain,” said Madhura Samant, Managing Partner at Elarra Law Offices.

Union Finance Minister Nirmala Sitharaman on Sunday declared that the Self-Reliant India Fund would receive an additional ₹2,000 crore in fiscal year 2026-27 to expedite the growth of micro, small, and medium enterprises (MSMEs).

Experts have continued to flag issues in the sector which restricted its growth. “Credit access and receipt of timely payments have been major challenges for MSMEs over the years, with an estimated ₹8.1 lakh crore locked in delayed payments, blocking working capital,” said Pushan Sharma, the Director of Crisil Intelligence on MSME sector.

To address these liquidity concerns, the budget has introduced several measures to enhance traction on the Trade Receivables Discounting System (TReDS) platform.

“Making TReDS a mandatory settlement platform for all Central Public Sector Enterprises is expected to improve MSME liquidity. Since its launch, TReDS has financed more than ₹5 lakh crore receivables, with fiscal 2025 volumes reaching ₹233,000 crore, a 69% on-year increase. Further, TReDS’ role as an asset-backed securities conduit will facilitate easier access to funding for MSMEs,” he said.

He further added that enabling invoice discounting through the Credit Guarantee Fund Trust for Micro and Small Enterprises is a crucial step to further strengthen the TReDS ecosystem.

Proposed changes:

— Sale of alcoholic beverages for human consumption: TCS rates on alcoholic drinks will be increased from 1% to 2%.

— Sale of tendu leaves: This product will attract a TCS rate of 2% if the change is approved, down from the earlier rate of 5% during its sale.

— Sale of scrap: The Budget 2026 proposes to hike the TCS rate on the sale of scrap to 2%, from the current 1% figure.

— Sale of minerals (coal, lignite, or iron ore): TCS rate on the sale of these products has been proposed to be hiked from 1% to 2%.

Finance Minister Nirmala Sitharaman also announced a reduction in the TCS rate for education and medical purposes from 5% to 2% in the Union Budget 2026, providing major relief for students and families.

“The move is a clear positive for Indian students aspiring to study abroad. By removing TCS entirely on education loans under Section 80E, raising the self-funded exemption threshold from ₹7 lakh to ₹10 lakh, and reducing TCS on higher self-funded remittances to 2%, the government has eased the upfront financial pressure families face during admissions and visa stages,” said Saurabh Arora, Founder and CEO at University Living.

Combined with policy support for NEP-aligned ‘Start in India, Transfer Abroad’ pathways, students can potentially reduce overall education costs by 20-40%, he added.

Paridhi Adani, Partner and head of Ahmedabad at Cyril Amarchand Mangaldas said that the Budget's emphasis on education infrastructure, particularly the idea of university townships, reflects a long-term view of talent development.

“This Budget connects education and healthcare in a way that is structurally important for India, enabling university and research ecosystems alongside pharma and healthcare innovation,” she said.

She further added that integrated university townships, skilling and R&D support will create the talent and research base needed for a stronger life-sciences sector, while regulatory stability and manufacturing depth enable scale. “Together, this positions India to move from cost-led growth to knowledge- and innovation-driven global leadership.”

In the Union Budget 2026-27, the goverment proposed measures to reduce prices of leather products, cancer drugs and seafood by extending policy support, allowing duty-free imports and granting customs exemptions, with the objective of strengthening domestic industries while easing costs for patients and producers.

Meanwhile, trading activity and some corporate cash-distribution mechanisms are expected to turn more expensive due to proposed revisions to buyback taxation, the securities transaction tax (STT), and tax collected at source (TCS), indicating a stricter approach toward tax arbitrage and compliance.

Check full list here

“Union Budget 2026-27 focused on sustained economic growth, infrastructure development, MSMEs, tourism, high-speed rail corridors, and manufacturing. From a real estate perspective, it has delivered limited direct but various indirect benefits - acting more as a growth catalyst than an instant rescue cavalry,” said Anuj Puri, Chairman of ANAROCK Group.

However, he noted, one major disappointment for the real estate sector was that there were no major announcements for affordable housing, which has been in free fall since the pandemic.

Citing internal data, Puri said the recent trend indicates that the sales share of affordable housing plummeted after the pandemic - from over 38% in 2019 to 26% in 2022 to just around 18% in 2025.

“The affordable housing segment was in express need of direct intervention by way of interest stimulants for buyers and developers of affordable housing. The segment needed high-impact measures,” he said.

In the Budget 2026 presentation, Finance Minister Nirmala Sitharaman announced a high-level panel, and NBFC overhaul, initiatives that the market experts welcomed.

“While the Budget doesn’t attempt a ‘big bang’, it sends an important signal of stability and policy continuity at a time of heightened geopolitical uncertainty—reinforcing that India remains open for business,” said Cyril Shroff, Managing Partner, Cyril Amarchand Mangaldas

According to him, the proposed high-level committee on banking is a timely opportunity to shape the next generation of banking reforms—strengthening governance, risk management and credit intermediation to support India’s investment cycle.

Similarly, the emphasis on an NBFC vision, including the restructuring roadmap for Power Finance Corporation and REC Limited can further deepen long-term financing for infrastructure and the energy transition, he added.

In a major relief for taxpayers, the Budget 2026 has proposed a reduction in Tax Collected at Source (TCS) on overseas tour packages to a flat 2% from the current rate of 5-20%, said Rikant Pittie, the CEO and Co-Founder of EaseMyTrip.

The move has eased the upfront financial burden on travellers and encouraged outbound travel, he said, adding that it is also expected to improve booking sentiment and enhance affordability for Indian travellers planning international trips.

“The budget also places strong emphasis on connectivity and infrastructure, announcing new air routes, seven high-speed rail corridors, expanded inland waterways, and incentives for seaplane operations to improve access to remote and scenic destinations. These initiatives are expected to strengthen both domestic and inbound tourism by reducing travel time and improving last-mile connectivity," he further added.

"The Union Budget 2026 continues the government’s push towards infrastructure-led growth, with a strong capital expenditure commitment of ₹12.2 lakh crore, said Ashish Raheja, the Managing director and CEO of Raheja Universal on Union Budget 2026*

He has hailed the government's focus on building well-planned cities beyond the metros. “The creation of city economic regions, with ₹50,000 crore allocated per region over five years, will significantly improve connectivity and urban infrastructure in Tier II and Tier III markets, opening up new opportunities across residential, commercial and mixed-use developments,” he said.

The proposed Infrastructure Risk Guarantee Fund is a practical step that can ease construction-phase risks and encourage greater private investment in large, long-gestation projects, he further added.

Under the Budget 2026 proposal, FM Nirmala Sitharaman has announced that Self-Help Entrepreneur (SHE) Marts will be set up as community-owned retail outlets within cluster-level federations.

The initiative aims to create stronger market access for enterprises set up by women residing in rural areas, and giving local products a more visible space.

It is also intended to help women business owners reach larger markets, build their brands and create steadier sources of income, while strengthening local institutions such as self-help groups

On the capital markets front, the Budget has introduced a market making framework, providing access to fund and derivatives on corporate bonds total return swaps, and permission to Persons Resident Outside India for making direct investment in listed equities.

“These initiatives are expected to significantly deepen market participation and improve liquidity,” said Sunil Badala, National Head of Tax, KPMG in India.

However, he added the increase in STT on derivatives may dampen the sentiment in the trading community. In order to curb the F&O frenzy the Finance Minister Nirmala Sitharaman has proposed to increase the Securities Transaction Tax (STT) on the Futures and Options transactions.

The income tax act 2025 has been promulgated, but as announced in the Budget 2026, the act will be effective from 1 April 2026.

“Even before it takes effect, the Finance Bill says that it is to be amended and there are as many as 87 clauses to amend this act,” Anil Harish, Partner, D.M. Harish & Co.

“That is truly shocking! We need stability in our laws and not these multiple changes every few months,” he added.

India approved a second tranche of its semiconductor incentive programme, India Semiconductor Mission 2.0 (ISM 2.0), in the Union Budget 2026-27.

The scheme aims to move domestic companies up the value chain by supporting the design of full-stack Indian intellectual property and strengthening the country’s chip supply ecosystem.

“The Increased focus on semiconductor manufacturing (including associated IP), electronics component manufacturing, rare earth and critical minerals corridors portends greater vertical integration in the electronics value chain,” said Arun Prabhu, Partner at Cyril Amarchand Mangaldas.

He further said that the Budget's cross sectoral emphasis on AI as an engine for inclusive growth along with the national AI, quantum missions, as well as research and development funds show a strong focus on AI to enable India’s economic and inclusion goals.

Finance Minister Nirmala Sitharaman has began addressing press conference post Union Budget 2026 presentation on Sunday, 1 January, 2026.

Sensex dropped more than 2,800 points from the day’s high, while the Nifty 50 slipped to 24,571.75, after Finance Minister Nirmala Sitharaman announced a hike in Securities Transaction Tax (STT) on derivatives.

STT on futures was raised to 0.05% from 0.02%, while STT on options transactions was increased to 0.15% from 0.01% earlier.

The markets later recovered part of the losses and were trading around 1% lower at about 2 pm.

Speaking of the the areas covered in today's announcement, Ashishkumar Chauhan, MD and CEO of NSE, said “The Budget also deepens financial markets through calibrated measures, such as higher STT on derivatives to curb excess speculation.”

Anil Agarwal, the chairman of Vedanta Ltd. hailed the Union Budget 2026, calling it a “ growth-oriented Budget, with a clear focus on increasing public capital expenditure and boosting manufacturing.”

“It is a Budget which creates opportunities, for youth to improve their livelihoods, women to become financially independent and for employment-intensive sectors like medical tourism to take off,” he said.

He further added that he welcomes government's keen attention to critical minerals and rare earths. “The Rare Earths Corridors for mining, processing, R&D and manufacturing in Odisha, Tamil Nadu, Andhra and Kerala will boost growth, employment and mineral security. Import duty exemption on capital goods for critical minerals processing is very timely in the current global scenario,” he noted.

The announcement on flexibility in SEZs, which will permit some sales in domestic market is an excellent move, he said.

The Union Budget 2026-27 proposed that buyback proceeds for all types of shareholders will be taxed as capital gains, announced the Finance Minister Nirmala Sitharaman. She added, however, that promoters will pay an additional buyback tax.

This means that if the rule is implemented, all amounts received by shareholders from a buyback will no longer be treated as a “deemed dividend”.

Under this rule, which became effective from 1 October 2024, the proceeds were taxed at the individual's applicable slab rate, instead of being taxed as capital gains.

FM Sitharaman proposed rate cuts, lower TDS on items, after which the following items may get cheaper:

• Overseas tour packages: TCS slashed from 5–20% to 2%
• Foreign education: Lower TDS under the LRS for education-related expenses
• Alcoholic liquor scrap and select minerals: Customs duty cut from 5% to 2%
• Shoe upper exports: Duty-free imports permitted
• Energy transition equipment: Basic customs duty (BCD) fully exempted
• Solar glass inputs: BCD exempted
• Civilian aircraft manufacturing parts and components: BCD exempted
• Drugs for rare and cancer diseases: BCD exempted
• Fish catch by Indian fishermen in Indian waters: BCD exempted
• Imports for nuclear power projects: BCD exempted

• The new Income Tax Act, 2025, seeks to simplify the 1961 Act to give rise to a shorter, clearer, and more concise document that can be beneficial for taxpayers.
• The Act has done away with redundant provisions and archaic language, introducing a simpler language for common people. It also reduces the number of Sections from 819 in the Income Tax Act of 1961 to 536, while the number of chapters have been reduced from 47 to 23.
• A major change in the Income Tax Act, 2025, is the renaming of Assessment Year (AY) and Financial Year (FY) to Tax Year, so as to avoid confusions.
• It retains the existing slab rates for salaried individuals, businesspersons, professionals and other taxpayers.
• The Centre has also retained the controversial provision where income tax officials will have the authority to access to your emails and social media during search operations or while seizing, thus retaining the definition of “virtual digital space”.
• The number of words had been reduced from 5.12 lakh to 2.6 lakh in the new Income Tax Act, and for the first time, it introduces 39 new tables and 40 new formulas, replacing the dense text of the 1961 law to enhance clarity.

The Income Tax Act, 2025, replacing the 1961 law was notified by the Centre on Friday, August 22, in its Official Gazette. This comes a day after President Droupadi Murmu gave assent to the Act.

Passed in the Parliament during the Monsoon Session last year, the new laws under Income Tax Act, 2025, will come into effect from April 1, 2026.

The Income Tax Act, 2025, replacing the 1961 law was notified by the Centre on Friday, August 22, in its Official Gazette. This comes a day after President Droupadi Murmu gave assent to the Act.

Passed in the Parliament during the Monsoon Session last year, the new laws under Income Tax Act, 2025, will come into effect from April 1, 2026.

STT or the Securities Transaction Tax, is a duty levied by the Indian government on the purchase and sale of stocks traded on recognised stock exchanges in India.

Finance Minister Nirmala Sitharaman in her Budget speech today proposed to increase the STT on Futures & Options (F&O) transactions.

She has proposed to raise the STT by more than 50% on futures to 0.05% from 0.02% and to 0.15% from 0.01% earlier on options transactions.

Finance Minister Nirmala Sitharaman announced a host of measures in her ninth consecutive Budget today. The measures aim to push India's Viksit Bharat vision forward. You can read Finance Minister Sitharaman's full Union Budget 2026 speech here.

Raj Gaikar, Research Analyst at SAMCO Securities noted, “The Finance Minister’s proposal to raise STT on futures to 0.05% is structurally negative for the capital market ecosystem, particularly F&O-driven businesses.”

• Higher transaction costs are likely to reduce trading volumes, dampen short-term momentum, and lower profitability for active market participants.
• FII participation in derivatives may also moderate as post-tax trading efficiency declines, impacting overall liquidity.
• This can create a cascading effect on revenue streams of broking companies, exchanges, AMCs, and depositories, which are closely linked to market turnover.
• With derivatives volumes already shrinking in recent months, the hike may further pressure near-term earnings visibility.
• While fiscally supportive, the measure poses headwinds for capital-market-linked stocks.

Aakash Shah, Technical Research Analyst at Choice Equity Broking feels that the increase in Securities Transaction Tax (STT), especially in futures and options, is likely to act as a marginal negative for foreign portfolio investor (FPI) flows in the near term, particularly for high-frequency and derivative-focused global funds.

“As per post-Budget updates, STT on futures has been raised from 0.02% to 0.05%, and on options premium from 0.10% to 0.15%, which meaningfully increases transaction costs for active strategies,” Shah stated.

He added, “Recent data already shows that FPIs have been cautious — with equity outflows of over ₹41,000 crore in January 2026 alone, reflecting global risk-off sentiment, elevated US bond yields, and currency pressures. In this context, a higher STT further reduces post-tax returns, making India relatively less competitive for short-term and derivative-oriented foreign flows.”

He however added that the STT hike is unlikely to be a deal-breaker. “Their (FPIs) investment decisions are more influenced by earnings visibility, currency stability, and policy predictability. That said, at the margin, higher transaction costs could tilt some global allocators towards other Asian markets, especially at a time when India is already facing pressure from AI-led capital shifts to the US, Taiwan and Korea,” Shah said.

“Overall, while the STT hike may help boost tax collections, it risks dampening trading volumes and could slow tactical FPI participation. To meaningfully revive sustained FPI inflows, investors will be looking more closely at macro stability, rupee movement, and consistency in tax policy rather than just growth optics,” according to him.

Finance Minister Nirmala Sitharaman in her Budget proposed to increase the Security Transaction Tax (STT) on futures and options (F&O). The centre has proposed to raise the STT on futures to 0.05%, compared to 0.02%, according to the official announcement.

Shripal Shah, MD and CEO of Kotak Securities called it a “steep increase” and noted that this “coming on top of last year’s hike, is likely to raise impact costs for traders, hedgers, and arbitrageurs”.

“This could cool derivative activity and lead to a reduction in volumes. The intent appears to be volume moderation rather than revenue maximisation, as any potential revenue gain could be offset by lower derivative volumes,” Shah added.

• Basic customs duty exemption on components and parts required for manufacture of civilian, training and other aircrafts.
• Increase in limit for duty-free imports specified inputs used for processing seafood products for export, from the current 1% to 3 % of FOB value previous year's export turnover.
• Duty free imports of specified inputs, which is currently available for exports of leather or synthetic footwear, to exports of Shoe Uppers as well.
• Complete removal of current value cap of ₹10 Lakh per consignment on courier exports.
• Customs Integrated System to be rolled out in 2 years as a single, integrated and scalable platform for all customs processes.

The Budget has expanded scope of Reits via public sector land monetisation. FM Sitharaman in Budget 2026 proposed to set up real estate investment trusts to monetise large land holdings held by central public sector enterprises across cities.

The infrastructure push in smaller cities and towns is also expected to boost real estate.

Finance Minister Nirmala Sitharaman's Union Budget 2026 speech has ended. There were no changes announced in income tax rates or slabs after last year's mega announcements.

FM Sitharaman also provided big relief for cancer patients:

• Basic customs duty exempted on 17 drugs and medicines.
• Added seven more rare diseases for the exemption of import duty on personal import of drugs, medicine, and food imported for special medical purposes.

Union FM Nirmala Sitharaman said, “I propose to increase the limit for duty-free imports of specified inputs used for processing sea foods for export from the current 1% to 3% of FOB value of the previous year's export turnover.”

She further added that duty-free imports will also be allowed for specified inputs which is currently available for exports of leather or synthetic footwear to exports of shoe uppers as well.

FM Sitharaman unveiled a massive plan for India’s medical sector:

• The initiative prioritizes a robust workforce and specialized care, marking a shift toward a more accessible and modern medical ecosystem.
• A key pillar of this plan is the addition of 100,000 allied health professionals over the next five years, alongside a program to train 150,000 caregivers. These professionals will support the physician workforce and improve the quality of post-operative recovery across the nation.
• A major focus was on mental health through the establishment of National Institute of Mental Health and Neurosciences (NIMHANS-2). This expansion aims to scale specialized expertise and research to reach a larger population.
• Furthermore, the budget details a 50% capacity increase in district hospitals by setting up dedicated emergency and trauma care centers. To decentralize high-end services, the government will support five regional medical hubs and launch three new All India Institutes of Ayurveda to promote integrated, holistic wellness.

A new scheme for small taxpayers has been proposed, wherein a rule-based automated process will enable obtaining a lower or nil deduction certificate instead of filing an application with the assessing officer.

For the ease of taxpayers holding securities in multiple companies. FM has proposed to enable depositories to accept Form 15G or Form 15H from the investor and provide it directly to various relevant companies.