A quiet Budget that roars with intent

I sat through the Union Finance Minister’s Budget speech—her ninth in Parliament—on Sunday and for the first time, came away with a distinct impression that quickly crystallised into a thought.

This was a ‘quiet’ Budget.

Quiet not because it escaped the usual parliamentary commotion, but because of its tone. Measured. Composed. Confident. It conveyed quiet resolve. It carried the assurance of a government that has internalised resilience, built policy depth over the past decade and more, and is prepared to act decisively amid global uncertainty. There was no overt theatrics—only a firm resolve and continuity of purpose.

Like in the past eleven years, Budget 2026–27 reinforces an infrastructure-led growth strategy, anchored in sustained public capital expenditure, manufacturing revival, human capital development, and strategic technology investments.

Infrastructure: Scaling growth while managing risk:

The centrepiece remains infrastructure. Public capex is scaled up to approximately ₹12.2 lakh crore by FY27, but more importantly, the Budget focuses on how this capital is deployed and financed. It aims at asset monetisation through REITs and InVITs, NIIF and NABFID to crowd in private finance while recycling brownfield assets.

Logistics and connectivity receive a decisive push through new Dedicated Freight Corridors, 20 National Waterways, coastal shipping promotion, and seven high-speed rail growth corridors, with an explicit emphasis on Tier II and Tier III cities. The proposed City Economic Regions (CERs) aim to unlock agglomeration economies by aligning city growth with sector-specific strengths.

Equally significant is the emphasis on de-risking infrastructure delivery. The proposed Infrastructure Risk Guarantee Fund, ₹2 lakh crore of capital support to states (SASCI), and energy-enabling infrastructure for nuclear power, energy storage, critical minerals, and CCUS collectively enhance investor confidence and long-term sustainability.

Manufacturing and MSMEs: A strategic new direction:

Manufacturing’s share of GDP has remained stagnant at around 15 per cent for years. Budget 2026–27 signals a clear intent to reverse this trend by combining sector-specific industrial policy with financing, liquidity, and compliance reforms, particularly for MSMEs.

The strategy rests on three pillars: deepening domestic manufacturing capabilities under Make in India; positioning MSMEs as employment and supply-chain anchors under Atmanirbhar Bharat; and improving competitiveness through ecosystem and policy support. The emphasis is not merely on survival, but on scale—enabling MSMEs to emerge as national champions integrated into global value chains.

Education and skilling: Turning demography into advantage:

Human capital development receives sustained attention. The Budget commits to training 1.5 lakh youth as caregivers and allied health professionals, with an additional one lakh to be trained in professional yoga and allied health services over the next five years.

Beyond numbers, the focus is structural. Expansion of STEM education, allied health institutions, university townships near industrial and logistics corridors, and upgraded research infrastructure strengthens India’s innovation base. Industry-aligned skilling—through NSQF programmes, AVGC and design institutions, creative economy initiatives, and services-export-oriented training—aligns workforce capabilities with future demand. The launch of AYUSH institutes, including an evidence-based research institute in Jamnagar, further integrates traditional knowledge with modern research.

R&D, AI and semiconductors: From adoption to co-creation:

Budget 2026–27 reflects India’s determination to move from a technology adopter to a technology co-creator. Investments in advanced research infrastructure and industry–academia collaboration aim to lift Total Factor Productivity—critical for long-term competitiveness. A combined allocation of ₹72,133 is set aside for them.

AI is positioned as a force multiplier across governance, manufacturing, healthcare, and services, shifting competition from labour arbitrage to innovation, quality, and speed. The India Semiconductor Mission 2.0—covering fabrication, packaging, testing, and electronics manufacturing—addresses strategic vulnerabilities, anchors high-value manufacturing, and integrates India more deeply into global semiconductor value chains.

Agriculture, rural growth and inclusion:

An allocation of ₹1.63 lakh crore for agriculture underscores continued focus on rural resilience. AI-driven productivity tools and support for high-value indigenous crops—such as coconut, cashew, walnut, cocoa, and sandalwood—signal a shift towards value-led agriculture. Women-led rural enterprises and livelihood initiatives strengthen non-farm employment and rural stability.

Digital infra: Anchoring the AI economy:

A combined allocation of ₹29,634 for digital infrastructure. The Budget’s long-term tax holidays up to 2047 for foreign cloud and data-centre companies, along with a 15 per cent safe-harbour regime and simplified tax rules, are designed to position India as a global digital and AI infrastructure hub. Anchoring data, cloud, and AI value chains domestically reduces dependence on overseas capacity and strengthens innovation-led services exports. This is going to be a definite game changer.

In sum, this Budget may sound quiet—but it speaks with confidence. Its strength lies in calibrated intent, institutional risk mitigation, and long-term capacity building rather than headline-grabbing announcements.

In a volatile global economy, that quiet resolve is precisely what makes it roar.

(The writer is founder and Director of Vayati Systems and Research Inc)