India’s upcoming 2026-27 budget could witness capital expenditure soaring past Rs 12 lakh crore with a 10% uplift, as per SBI’s latest report. This strategic escalation targets infrastructure revival, promising widespread economic benefits.
Major thrusts in roads, rails, maritime hubs, and energy infrastructure will not only boost connectivity but also ignite job markets and private sector participation, amplifying growth multipliers.
In an era of global volatility—marked by disjointed trade and debt vulnerabilities—India’s fiscal restraint is pivotal. The nation’s post-coronavirus bounce-back has notably surpassed global crisis recoveries, bolstering confidence.
Expect tax receipts to edge higher, non-tax flat, nominal GDP expanding 10.5-11% despite commodity inflation spillovers. Fiscal gap at 4.2% GDP, adaptable to new series.
Borrowings: Centre Rs 11.7 lakh crore net (Rs 4.87 lakh crore repay); states Rs 12.6 lakh crore (Rs 4.2 lakh crore repay). Enhanced RBI OMOs to maintain liquidity.
Savings boosters: Tax bank interest like capital gains, 3-year FD locks matching ELSS, TDS hikes. GST reforms via ISD clarity, banking TDS waiver, insurance-pension expansions.
For states’ heavy debt, mandate GSDP-based medium-term strategies in budgets, urged for Union spotlight.
This SBI outlook charts a path for transformative budgeting, harmonizing ambition with accountability for sustained Indian progress.