The Union Budget 2026-27: Sustained Capex Push and Sectoral Reforms to Fuel Industrial, Agri, and Tourism Growth
New Delhi/Hyderabad, February 5, 2026 — Finance Minister Nirmala Sitharaman presented the Union Budget 2026-27 on February 1, 2026, marking her ninth consecutive presentation a historic milestone. Framed as a “Yuva Shakti–driven budget” under the vision of Viksit Bharat, it emphasizes transforming aspirations into achievements through sustained public investment, domestic manufacturing, technology integration, and inclusive sectoral development. Total expenditure is pegged at around ₹53.5 lakh crore, with public capital expenditure (capex) hiked to ₹12.2 lakh crore (up from ₹11 lakh crore in the previous revised estimates), reinforcing infrastructure-led growth. The fiscal deficit is targeted at 4.3% of GDP (improved from 4.4% in FY26 RE), with the debt-to-GDP ratio projected at 55.6%, reflecting continued fiscal prudence amid global uncertainties.
The budget builds on structural reforms, prioritizing manufacturing revival, logistics efficiency, agriculture modernization via AI and data platforms, and experience-led tourism to drive productivity, employment, and resilience.
A key highlight is the sustained ₹12.2 lakh crore capex allocation to bolster infrastructure, freight corridors, industrial clusters, and logistics upgrades, aimed at reducing costs, enhancing supply chains, and crowding in private investment. This supports manufacturing competitiveness, with measures like chemical parks, cluster-based infrastructure, simplified compliance, and schemes for high-value equipment and container manufacturing.
Mukund Vasudevan, Managing Director of SKF India (Industrial) Limited and President – India, Southeast Asia and Middle East, welcomed the industrial thrust: “The Union Budget 2026–27 delivers a clear, confidence‑boosting push for India’s industrial growth. Despite maintaining fiscal discipline, the higher public CAPEX of ₹12.2 lakh crore signals strong momentum for manufacturing and infrastructure. Reforms focused on financial access, technology adoption, and competitiveness lay the groundwork for long-term industrial strength – key for India to scale and compete alongside with global players. Investments in freight and industrial corridors, along with logistics upgrades, will lower costs, strengthen supply chains, and make Indian manufacturing more efficient. MSME-focused steps such as the Growth Fund and an expanded TReDS ecosystem should ease liquidity and improve access to capital. Overall, the Budget reinforces India’s direction toward localization, private investment, and resilient industrial growth, giving businesses greater clarity and confidence to scale.”
In agriculture, the budget advances tech-driven transformation with the launch of Bharat-VISTAAR, a multilingual AI platform integrating AgriStack and ICAR systems for better decision-making on yields, pricing, and risk. It promotes high-value crops (coconut, cocoa, cashew, sandalwood), orchard rejuvenation, nut cultivation diversification, and fisheries value chain development through 500 reservoirs and Amrit Sarovars, targeting rural income enhancement and climate resilience.
Vivek Raj, Founder & CEO of Panama Corporation, highlighted the shift: “The Union Budget 2026–27 marks a decisive structural shift in how agriculture is positioned within India’s growth and technology story. By bringing AI, data intelligence, and digital public infrastructure into farming, it signals a move from intuition-led to evidence-based, climate-resilient agriculture. The launch of Bharat-VISTAAR, a multilingual AI platform integrating AgriStack and ICAR systems, could meaningfully improve how farmers make decisions on yields, pricing, and risk. At the same time, the focus on high-value crops like coconut, cocoa, cashew, and sandalwood encourages diversification and better income opportunities, particularly in suitable regions. Overall, the Budget reinforces that technology-led agriculture will be central to India’s long-term economic resilience, food security, and global competitiveness. Execution will matter- but the direction is clear.”
For the chemicals sector, initiatives include dedicated chemical parks on a cluster-based plug-and-play model, alongside sustainability measures like carbon capture technologies, aligning with energy transition goals.
Dhiren Jatakia, Head – Accounts & Finance, Covestro India, welcomed the initiatives: “We welcome the government’s focus on strengthening domestic manufacturing, particularly in the chemicals sector. Initiatives like chemical parks and cluster-based infrastructure will help scale production, strengthen supply chains, and create opportunities for local businesses. Support for industrial and logistics infrastructure, along with simplified compliance, will enable manufacturers to grow and innovate. We also value the emphasis on sustainability, energy transition, and carbon capture technologies, which aligns with Covestro India’s commitment to responsible growth and advanced materials for a greener future. These measures lay a strong foundation for innovation, reduced import dependence, and a competitive, resilient chemical industry in India.”
Agriculture and allied sectors receive measured support for productivity and diversification, including targeted interventions in high-value crops, fisheries (benefiting women-led groups and FPOs), and advisory services via Bharat Vistaar.
Ramakrishnan M., Managing Director of Primus Partners, noted: “This year’s budget offers steady, measured support for agriculture and allied activities. The emphasis on high-value agriculture and fisheries is a welcome move toward improving productivity and diversifying rural incomes. Targeted support for coconut, cashew, cocoa and sandalwood, along with orchard rejuvenation and expanded nut cultivation, can strengthen farmer earnings across coastal, North-Eastern and hilly regions. The development of 500 reservoirs and Amrit Sarovars will deepen the fisheries value chain, particularly for women-led groups and FPOs. Bharat Vistaar, the new multilingual AI platform, holds strong potential for better advisory services and risk management, making this a constructive step forward for the sector.”
Tourism gets a fresh impetus through curated, experience-led products in archaeological, heritage, eco, and astro segments, with calls for robust governance and destination marketing to foster distinctive identities and repeat visits.
Shubham Katyayan, VP at Primus Partners, emphasized: “The Budget 2026 push for curated and experience-led tourism products spanning from archaeological, heritage, eco and astro tourism interventions marks a significant shift on reimagining the destinations. To realize the objective, these portfolios must be supported by not only robust governance but also by strong destination marketing strategies that emphasize emotional, sensory and personalized experiences. This is essential to build distinctive destination identities, enhance visitor satisfaction, and drive repeat visits.”
Overall, the Union Budget 2026-27 maintains policy continuity with incremental, execution-focused reforms across manufacturing, agriculture, chemicals, and tourism. By balancing fiscal discipline with targeted investments in infrastructure, technology, and sectoral competitiveness, it aims to sustain 7%+ growth, reduce import dependencies, and harness India’s potential for resilient, inclusive development. Industry reactions underscore optimism, with success depending on swift implementation and public-private collaboration.
Last Updated on Thursday, February 5, 2026 10:41 am by Startup Magazine Team
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