A Futuristic Budget Sans Populism: On Union Budget 2026

The Union Budget 2026 is more futuristic in nature than populist. This could dishearten some who were expecting more incentives, given the progress the Indian economy has made over the past couple of years, but it appears to be the most suitable approach in light of global uncertainty. The budget focuses on infrastructure, employment and maintaining fiscal discipline to safeguard the economy from potential future threats, especially as tensions rise in Latin America and West Asia, with no signs of peace returning to Eastern Europe. In such a situation, self-sufficiency holds the key to keep the economy safe from geopolitical risks. This could be the reason for prioritising sectors like semiconductors, rare earths, biopharma, chemicals and advanced materials to reduce the county’s dependence on exports. It may be mentioned here that the Economic Survey has warned that emerging markets might face shortage of base metals, crude oil and pharmaceuticals, etc. As for the proposed seven high-speed rail corridors between key cities to serve as 'growth connectors', such infrastructure can significantly contribute to economic growth like reducing travel times and decreasing carbon emissions, but it has also drawn criticism over massive expenditure required for such mega projects. Modern infrastructure is essential for stimulating economic growth; however, pressing issues such as safety must not be overlooked.

It may be mentioned that stock market benchmark indices Sensex and Nifty plunged over 2000 and 600 points respectively, marking the one of the worst Budget day performances in recent years. This was sparked by factors like the proposed in the Securities Transaction Tax (STT) on futures and options with an aim to protect small and retail investors from incurring heavy losses. Instead of welcoming the step, the response was just the opposite. Despite optimistic growth outlook, markets were not convinced by the Budget, thus the knee-jerk reaction. However, the market is expected to bounce back soon. Overall, the Budget 2026 focuses on building strong economic fundamentals that could help combat any future global economic crisis. By any yardstick, it is not a ‘please all’ budget, but could contribute to the progress of the country in future. This year’s budget can be described as a pragmatic financial document that has not succumbed to popular demands, and instead embraced reality, having experienced the consequences of being over-ambitious. Reflecting this sentiment, no specific sops were announced for any sector, especially for Indian incorporated companies (INCs). The budget highlights a path that may seem challenging at first but could lead to positive results in the long run.