Finance minister Nirmala Sitharaman
NEW DELHI: Union finance minister Nirmala Sitharaman on Sunday delivered a 1 hour 25 minute presentation of the Union Budget 2026-27, marking her record ninth consecutive budget. She made several major announcements covering income tax, defence, railways, MSMEs, healthcare, and more.The budget was hailed as “historic” by Prime Minister Narendra Modi, who described it as a “high flight toward Viksit Bharat” by 2047, shortly after FM Sitharaman’s presentation in the Lok Sabha.
Here are the 10 big announcements from Union Budget 2026
- Defence – The Union Budget 2026 has allocated Rs 7.85 lakh crore to the Defence Ministry, up from Rs 6.81 lakh crore last year. Out of this, Rs 2.19 lakh crore will go toward modernising the armed forces, including Rs 63,733 crore for aircraft and engines and Rs 25,023 crore for the Navy. The remaining Rs 5.54 lakh crore will cover running expenses, including Rs 1.71 lakh crore for pensions.
- Railways – The FM Sitharaman proposed seven high-speed rail corridors connecting major cities—Mumbai-Pune, Pune-Hyderabad, Hyderabad-Bengaluru, Hyderabad-Chennai, Chennai-Bengaluru, Delhi-Varanasi, and Varanasi-Siliguri—to promote an environmentally sustainable passenger system. The Railways has been allocated a strong capital expenditure of Rs 2,93,030 crore to boost infrastructure-driven growth and fast-track the vision of Viksit Bharat. She also announced a new dedicated freight corridor linking Dankuni in West Bengal to Surat in Gujarat to ensure efficient and eco-friendly movement of goods across the country.
- Income Tax – Sitharaman announced that the Income Tax Act, 2025 will come into effect from April 1, replacing the six-decade-old tax law. The new law simplifies rules and forms, making compliance easier for taxpayers, and is revenue neutral with no change in tax rates. It cuts sections by about 50%, removes ambiguities, replaces the assessment year with a single “tax year,” and allows TDS refunds even if ITRs are filed late without penalties.
- Rare-earth – The Budget proposed supporting mineral-rich states like Odisha, Kerala, Andhra Pradesh, and Tamil Nadu in setting up dedicated rare earth corridors. This builds on the ‘Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnets’ launched in November 2025, which has a financial outlay of Rs 7,280 crore. The scheme aims to create 6,000 metric tonnes per year of integrated REPM manufacturing capacity in India, covering the complete production chain from rare-earth oxides to finished magnets.
- Health – The Union health ministry has been allocated Rs 1,06,530.42 crore in Budget 2026-27, a 10% increase from last year, according to news agency PTI. FM Sitharaman announced a scheme to set up five regional medical hubs with private-sector support to boost medical tourism. Existing allied healthcare institutions will be upgraded, and new ones established, training 1 lakh professionals across 10 disciplines over the next five years. A Rs 10,000 crore investment proposed over the next five years to make India a biopharma manufacturing hub, establish 1,000 clinical trial sites, and strengthen the Central Drugs Standard Control Organisation.
- Boost to MSMEs – The minister proposed a three-pronged strategy to boost MSMEs, including a dedicated Rs 10,000 crore fund to help them grow as ‘Champions’. In her Budget speech, she said the Modi government’s reforms aim to create jobs, increase productivity, and accelerate growth. She outlined “three kartavyas”: accelerate and sustain economic growth, fulfil aspirations and build capacity, and Sabka Sath, Sabka Vikas. Under the first, she highlighted six interventions, including support for Champion MSMEs.
- Education – It also included boost to education with a National Institute of Design in eastern India, five university townships near industrial corridors, and a girls’ hostel in every district for STEM students. Four telescope facilities for astrophysics research will be set up, and a high-powered ‘Education to Employment and Enterprise Committee’ will align skills with jobs and emerging technologies like AI. Under ‘Orange Economy’, FM also proposed content creator labs in schools and colleges to create ‘future-ready jobs’.
- Banking – A “High Level Committee on Banking for Viksit Bharat” was proposed to review the sector and align it with India’s next phase of growth. She said the committee will focus on financial stability, inclusion, and consumer protection. Highlighting the strength of India’s banking sector, she noted strong balance sheets, record profitability, improved asset quality, and coverage of over 98 per cent of villages.
- Agriculture – The Budget also outlined major reform for the agriculture sector, the FM announced announced the launch of ‘Bharat Vistar’ a multilingual AI tool set to integrate AgriStack portals and ICAR’s agricultural practices with advanced AI systems, transforming how farmers access resources and make decisions.
- Khelo India – Under Budget 2026-27, the finance minister unveiled the Khelo India Mission to revamp the sports sector over the next decade, focusing on talent identification, coach training, sports science, and modern infrastructure development.
