Budget's Financial Framework
The Union Budget 2026-27 introduced a series of key financial allocations and targets. A significant aspect was the government's setting of a capital expenditure
target for fiscal year 2027 at Rs 12.2 lakh crore. The defense budget experienced a substantial increase, reaching Rs 7.85 lakh crore, with Rs 2.19 lakh crore specifically earmarked for modernization efforts. Additionally, there was a focus on the semiconductor industry, with the launch of the 'India Semiconductor Mission 2.0'. Furthermore, the budget included provisions for income tax, the new income tax regime, and Section 87A rebate limits.
Defense and Modernization Boost
A pivotal element of the Union Budget 2026-27 was the significant allocation towards defense, showcasing the government's commitment to national security. The defense budget saw a notable surge, reaching Rs 7.85 lakh crore, a clear indication of prioritizing strengthening the armed forces. Moreover, a substantial portion, Rs 2.19 lakh crore, was explicitly allocated for the modernization of defense capabilities. This investment underscores the government's intention to enhance the country's military infrastructure and technological prowess, ensuring that the armed forces are equipped with the latest advancements. These financial commitments reflect a strategic vision aimed at bolstering India's defense preparedness.
Taxation and Economic Policies
The Union Budget 2026-27 also presented several crucial adjustments to the tax regime, impacting various income brackets. Details were provided regarding the new income tax slabs and rates for the fiscal year 2026-27, alongside information on the old versus new tax regimes. The budget outlined the Section 87A rebate limit under the new income tax regime for the financial year 2026-27, providing clarity for taxpayers. These adjustments were aimed at streamlining tax regulations and potentially offering relief to taxpayers. These provisions represent a concerted effort to create a more efficient and transparent tax system.
Healthcare and Social Initiatives
The Union Budget 2026-27 displayed an emphasis on healthcare, including mental health, and other social programs. The budget allocated funds to enhance mental healthcare services, particularly focusing on the establishment of a NIMHANS center in North India. This initiative is aimed at improving access to specialized mental health facilities. Additionally, the government waived customs duty on specific drugs, such as those for cancer and rare diseases. This measure seeks to reduce the financial burden on patients. These initiatives reflect a commitment to bolstering the healthcare infrastructure and improving the quality of life for citizens.
Reactions and Reactions
The Union Budget 2026-27 drew varied responses from political figures and analysts. Rahul Gandhi and other opposition leaders voiced their criticisms, with some expressing concerns over the budget's approach. Congress, in its initial reaction, criticized the budget, calling it 'completely hollow'. Conversely, Prime Minister Narendra Modi hailed the budget as 'historic,' highlighting its focus on the 'Viksit Bharat' vision. These divergent views reflect differing perspectives on the budget's potential impact and priorities.
