The estimated Rs 1 trillion revenue forgone from direct taxes and Rs 2,600 crore from indirect taxes has been carefully accounted for within the fiscal consolidation road map, ensuring stability while boosting demand.

Budget 2025-26 delivers a carefully calibrated strategy—stimulating demand and investment while keeping fiscal discipline intact.

In an environment marked by global trade disruptions, and a softening in urban consumption, Finance Minister Nirmala Sitharaman has taken a measured approach.

The fiscal deficit target of 4.4 per cent of GDP, down from 4.8 per cent, signals a firm commitment to consolidation, without throttling the economy’s growth momentum.

The government has sent a clear message: India will expand, but without reckless borrowing.

With gross market borrowings at Rs 14.82 trillion and net borrowings at Rs 11.54 trillion, the fiscal road map remains credible.

Crucially, the Centre’s debt as a percentage of GDP is set to decline, reinforcing India’s financial stability.

Yet, fiscal restraint has not come at the expense of growth.

Total expenditure is pegged at Rs 50.65 trillion, with capital investment rising by 10 per cent over the previous year.

This public investment push is a deliberate strategy—crowding in private capital and ensuring long-term economic resilience.

The most notable tax reform—the income tax exemption for those earning up to Rs 12 lakh—is designed to unlock spending power among middle-class households.

Higher discretionary income will flow into sectors like housing, automobiles, consumer goods, apparel, and travel, providing a much-needed demand stimulus.

However, tax relief alone does not define sound economic management.

The government has managed to introduce this reform without excessive fiscal slippage.

The estimated Rs 1 trillion revenue forgone from direct taxes and Rs 2,600 crore from indirect taxes has been carefully accounted for within the fiscal consolidation road map, ensuring stability while boosting demand.

The Budget underscores the government’s belief that infrastructure is the bedrock of sustained growth.

A Rs 1.5 trillion capital outlay for states is tied to reform conditions, ensuring that funds translate into meaningful development rather than routine expenditure.

On the investment front, the government has introduced innovative financing mechanisms to leverage private capital.

The Urban Challenge Fund of  Rs 1 trillion requires at least 50 per cent of project costs to be funded through bonds, bank loans, and PPPs, effectively multiplying the impact of government spending without straining the fiscal deficit.

Similarly, the Asset Monetization Plan targeting  Rs 10 trillion for new projects aims to recycle government assets efficiently.

For too long, the conversation around MSMEs has been dominated by subsidies and short-term relief.

This Budget moves away from a dependency model, instead doubling credit and term loan limits for MSMEs, particularly exporters.

Expanding financing options is a far more sustainable growth strategy than direct fiscal handouts.

Trade competitiveness gets a push with the Export Promotion Mission and BharatTradeNet, designed to streamline logistics, reduce compliance burdens, and improve access to global markets.

This is a recognition that Indian businesses need fewer obstacles, not just more incentives.

One of the most consequential—but least discussed—aspects of this Budget is the aggressive push for regulatory reform.

The decriminalisation of 180 legal provisions and the creation of a high-level committee to overhaul non-financial regulations mark a fundamental shift in  business environment.

For decades, regulatory unpredictability has deterred investment and slowed down enterprise growth.

A more trust-driven, predictable framework will not only enhance the ease of doing business but also attract long-term capital—the kind that builds industries, not just finances speculation.

This Budget sets the stage—but policy alone does not create growth.

The government has laid down the foundations for a consumption-driven recovery, investment-led expansion, and a business-friendly regulatory regime.

Now, the responsibility shifts to entrepreneurs to scale up, businesses to invest, and consumers to drive demand.

India’s path to becoming a developed economy will not be dictated by fiscal measures alone—it will depend on how effectively the private sector seizes the opportunities this budget has created.

The government has done its part. It is now time for businesses and investors to deliver.

Kumar Mangalam Birla is the chairperson of  Aditya Birla Group