Budget 2026 Expectations Live: Focus On EV Mobility, AI Skilling, And More

Budget expectations for agriculture include cold-chain expansion, logistics upgrades, and market reforms to reduce post-harvest losses and link farmers better with markets. Experts also want export-oriented infrastructure, quality labs, and certification systems to help Indian produce compete globally as per a report from Phillip Capital.

"Increased research and development  funding for agri-tech, seed systems and productivity innovations is being sought to modernize agriculture. Push toward digital agriculture tools (e.g., precision farming, data systems, climate resilience tech) is a common theme among industry voices," the report said.

Nikunj Aggarwal, Promoter and Whole time Director at Ardee Industries Ltd., stated that the firm anticipates the Budget to focus on consolidating India's recycling-led manufacturing.  Aggarwal especially emphasised on the prominence and importance of lead recycling and manufacturing.

"Lead is among the most extensively recycled metals globally, and in India nearly 85–90% of lead production comes from recycling, underscoring the sector’s critical role in resource efficiency. With over 80% of lead consumption driven by battery manufacturing and an installed recycling capacity of around 3.53 million tonnes per annum across nearly 672 registered units, the industry is well positioned for sustainable growth," Aggarwal said.

Paresh Parekh, Partner and National Leader – Tax (Consumer Products & Retail), EY India, flags industry concerns. "Despite GST 2.0 rate reductions boosting demand, FMCG companies continue to face inverted duty issues, with inputs and services taxed at 18% while finished goods attract 5% GST. Credit accumulation from media, advertising and capex remains a major challenge."

Analysts at Jefferies expect defence to dominate incremental capex. “Government capex growth in FY27 should exceed 10%, with defence taking priority. We expect defence capex growth to significantly outpace non-defence spending, reflecting strategic and indigenisation priorities.”

PhillipCapital expects capital expenditure to stay central to the growth narrative. "FY27 should provide greater headroom for capital expenditure, with capex growth of around 10% likely. Continued focus on railways, roads and defence, along with higher PLI allocations and targeted subsidies, should support industrial and infrastructure sectors."
 

Parmod Sagar, Chairman, MD & CEO, RHI Magnesita India, says recognising refractories as a strategic sector is essential for sustaining India’s infrastructure and manufacturing push. “The refractory industry is a silent but indispensable enabler of India’s infrastructure growth—without it, not a single tonne of steel, cement or glass can be produced. Recognising refractories as a ‘Critical Sector’ would help ensure supply-chain continuity and prevent industrial bottlenecks, especially in an increasingly uncertain geopolitical environment. To strengthen Make in India and enhance global competitiveness, the duty structure on essential raw materials such as magnesite and alumina needs reconsideration, as even a 5% import duty creates a meaningful cost burden."

Analysts at Macquarie say the government is unlikely to deviate from its consolidation path. "We expect the FY27 fiscal deficit to be guided towards 4–4.2% of GDP, even if FY26 sees marginal slippage. The medium-term objective of reducing central government debt towards 50% of GDP by FY31 remains intact, limiting the scope for aggressive fiscal expansion."

Jacob Joy, Founder of Jakobi Chocolatier and Director at JJ Confectionery, says that  “As we head into Budget 2026, the Indian chocolate and confectionery sector is looking for policy clarity that enables long-term planning rather than short-term fixes. One of the most important expectations is tax stability. Maintaining the 5% GST rate for the next few years would give MSMEs the confidence to invest, scale manufacturing, and build brands sustainably. Input cost volatility, especially cocoa, remains a key challenge. Rationalising customs duties during global price spikes and exploring a commodity stabilisation mechanism could go a long way in protecting domestic manufacturers. We also hope to see stronger manufacturing support through accelerated depreciation on food-grade equipment and targeted capex incentives for mid-scale investments."

Raju Kumar, Partner and Energy Leader – Tax, EY India, points to structural bottlenecks. "A dedicated climate-finance facility could help crowd in private capital, but challenges such as DISCOM stress, limited bankability of storage solutions, high upfront costs and policy uncertainty continue to weigh on the sector. Accelerated depreciation for green assets, GST rationalisation and tax certainty are crucial."

According to Nuvama, tax relief is unlikely to be a major lever in FY27. "With recent income tax and GST rationalisation already weighing on revenues, further tax cuts appear unlikely. FY27 is more likely to focus on investment support through deregulation and capex rather than additional consumption-led measures."

Saurabh Agarwal, Partner and Automotive Tax Leader, EY India, says demand incentives must focus on high-impact segments. "Incentives under PM E-DRIVE should remain focused on public transport, shared mobility, commercial fleets and last-mile delivery, where electrification delivers the maximum impact. Faster adoption in these segments is critical to achieving the 30% EV penetration target by 2030."

Ajay Kumar Yadav, Group CEO & CIO, Wise Finserv, says markets are not seeking dramatic announcements, but just looking for reassurance. "The next step should focus on targeted fiscal support. Incentives linked to job creation, incremental investment, and manufacturing capacity can revive private capex without stretching fiscal discipline. Continued thrust on infrastructure spending would also help crowd in private investment and support employment."

Rajat Khandelwal, Group CEO, Tribeca Developers says, "Ahead of Budget 2026, the real estate sector is looking for policy continuity that supports both supply and demand. Granting industry status to real estate remains crucial, as it would ease access to long-term capital, lower borrowing costs, and improve execution efficiency for developers. Increasing investments in urban infrastructure, such as roads, public transport, and smart city initiatives, will also enhance property values. Offering tax benefits or subsidies for adopting green building technologies and renewable energy solutions will encourage developers to contribute to India’s climate goals."

Manav Subodh, Curator of 1.5 Matters, says that "If the Union Budget 2026–27 treats climate action as a side note, India risks exporting the wrong lesson to the Global South. India is the development model many emerging economies watch not because it is perfect, but because it is practical. A dedicated Climate Innovation Fund is essential to move from climate symbolism to climate outcomes: investments that are judged by emissions reduced, resilience built, and jobs created."

Srivatsan Iyer, Global CEO of Hero Future Energies says, "to further strengthen the renewable energy 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."

Sushil Kumar Aggarwal, Chairman and Whole-Time Director of AVRO India Limited; National President of The All-India Plastics Molded Furniture Manufacturers Association (AIPMFMA) says “India’s formal recycling ecosystem remains constrained by a policy framework that has not kept pace with sustainability goals. High GST on plastic waste, scrap, recycling machinery, and inputs continues to make compliant recycling financially uncompetitive. The Union Budget must prioritise zero-rating GST on plastic waste, scrap, and recycling equipment, along with a meaningful reduction in GST on recycled plastic granules, to incentivise their use in long-life and durable products. Without correcting these cost distortions, the transition from virgin to recycled plastics will remain limited."

Shreevardhan Sinha, Senior Partner, Desai & Diwanji says, "as defence manufacturing and procurement become strategic economic priorities, Budget 2026 should focus on contractual certainty, faster payment cycles, and tax neutrality for long-term defence projects. Strengthening the legal and fiscal framework around indigenisation will be critical to attracting sustained private sector participation in the defence value chain."

Rakesh Goyal, Director at Probus, says the real question is whether insurance coverage can truly keep up with rising medical bills and everyday financial shocks people face. He expects the budget to "recognise preventive healthcare and OPD expenses within the tax framework, as early intervention reduces long-term treatment costs and overall system strain. Additionally, simpler taxation can promote involvement in life and retirement planning at all stages of life, particularly for younger earners. While policyholders have welcomed the recent GST exemption on health and life insurance, the structure of the exemption means that input taxes on distribution and operational costs cannot be offset, adding to cost pressures across the insurance ecosystem."
 

Dr. K. Rathnam, Whole Time Director & CEO, Milky Mist Dairy Food Limited, believes there is "scope for further rationalisation of key inputs such as packaging material, refrigeration equipment, animal feed and veterinary services. A strong policy push towards strengthening cold-chain infrastructure and logistics is critical. Enhanced capital subsidies, interest subvention schemes and easier access to long-term credit will help bridge existing infrastructure gaps, reduce wastage and improve milk quality, especially in hinterland regions. Targeted incentives for both dairy companies and farmers are equally important. From an industry standpoint, incentives for value-added dairy products, automation, advanced quality-testing laboratories and sustainability initiatives will encourage private players to invest in modern, scalable capacity aligned with global standards."

Anil Rawal, MD & CEO, IntelliSmart Infrastructure says smart meters deserve a formal recognition under the Harmonized Master List of Infrastructure. He expects that "this inclusion will unlock transformative benefits such as long-term, low-cost capital through priority sector lending, infrastructure bonds, InVITs, and global institutional investors, while providing critical regulatory clarity for lenders and developers navigating this evolving landscape. Additionally, it will eliminate existing ambiguities, accelerate the Revamped Distribution Sector Scheme (RDSS) implementation, and reinforce India's transition toward a resilient, data-driven and sustainable power ecosystem."

Jatin Varma, Ex CEO, Founder of Comic Con India says that over the past few years, the Union Budget has started recognising the Animation, Visual Effects, Gaming, and Comics (AVGC) sector more seriously which is a positive shift. For 2026, the hope is that this support becomes more real for comics, especially independent publishing. What would really help now is specific attention to creator grants, printing and distribution support, and platforms where new talent can actually reach readers. We talk a lot about India’s soft power, comics are often where that journey starts.” 

Robin Mangla, President, M3M India says that over the last decade, infrastructure-led development has fundamentally reshaped NCR, and the next cycle of growth will be defined by quality, integrated planning, and capital efficiency rather than volume alone. From an industry standpoint, the focus must now shift toward creating a stable and predictable policy environment for premium residential and mixed-use developments. Rationalisation of taxation for homebuyers, along with smoother access to institutional and long-term capital, will help strengthen investor confidence and sustain end-user demand. Equally important are faster, single-window clearances and time-bound approvals, which directly impact project execution, cost efficiencies, and capital deployment." 

Sriram Kannan, Founder & CEO, Routematic expects "Budget 2026 to present a significant opportunity to accelerate the transition from traditional mobility to a more electrified, connected and enterprise-ready ecosystem. We expect the government to introduce policy measures and fiscal support that improve the economics of fleet electrification. This includes lowering EV acquisition costs, GST rationalization on EVs, enabling easier financing through improved EMI structures, and accelerating the expansion of EV charging infrastructure and supply chain across the country to drive wider adoption, including among fleet drivers."

Surbhi Puri, Director, Green Power International says 2025 was significant in India's journey to achieve Net Zero carbon emissions by 2070 while fostering sustainable and inclusive development. She expects "Further reduction in customs duty on imported machinery would help lower overall project costs and accelerate the deployment of advanced technologies that support the transition to lower carbon emissions across the sector. In addition, establishing a single-window clearance framework for the installation of gensets, by integrating applicable environmental, electrical, and local authority approvals, would significantly reduce project lead times and compliance burdens for investors."

Ambika Saxena, Co-founder, TWH Hospitality says "Demand today is no longer limited to seasonal leisure travel. Being closely involved in the hospitality ecosystem across destinations like Goa and the Tricity region, we're witnessing a clear shift in traveller behaviour, and spans experiential beach stays, wellness-led retreats, and long-stay work-from-anywhere travellers, directly influencing hotel occupancies and stay durations.
We expect Budget 2026 to be a real enabler if it addresses long-standing issues such as high GST on room tariffs, along with easier access to institutional credit for small and mid-sized hospitality operators."

Abhay Mishra, President & CEO, Jindal Realty, says "The upcoming Union Budget 2026 should recognise that India’s housing momentum is now led by Tier-II cities rather than just metros. With better infrastructure and stable prices, these markets can grow faster if the budget boosts urban infrastructure spending, gives tax support to homebuyers, and encourages affordable housing. Sonipat, an emerging NCR hotspot, is benefiting from expressway connectivity, Namo Bharat, and industrial growth, which is driving homebuyers’ demand. If the budget channels more funds and policy attention to cities like Sonipat, it can firmly position growing economic hubs of India as the real driver of the country’s real estate growth."

Dr Ajay Kela, CEO & Board Member, Wadhwani Foundation says that "India is now the world’s third-largest startup ecosystem, but the next phase of high-value jobs and economic growth will depend on deep-tech innovation and how well research translates into enterprises and jobs." He believes that "Budget 2026 should strengthen innovation ecosystems that move ideas from labs to markets, through translation support, including entrepreneurs' training of researchers, applied research, and clear commercialization pathways, so that innovation in AI and emerging technologies drives new ventures, productivity, and high-value employment.”