31 January 2026
With the Finance Minister set to unveil the Union Budget 2026, the context is set by the Economic Survey 2026, which foresees a “confident 7% growth path” while also stressing the importance of “strategic indispensability.” The Economic Survey is absolutely right in saying that the key to resilience is “structural deepening that enhances data integrity, secures borders, and builds human capital.” This budget presents a momentous chance to turn these ideas into reality.
The first major achievement for 2026 is the Caste-based Census for the entire country. To make this more than a simple headcount and instead a means for targeted welfare, the Budget has to provide for adequate digital infrastructure. This includes training the counting staff to create 1.02 crore man-days of employment, tracked through a Census Management & Monitoring System (CMMS). To make the data as accurate as possible, the Budget should provide for AI-powered validation systems to compare satellite images with ground reports, facilitated by Data Centres that are privacy-compliant according to the DPDA.
The Survey points out the risks of climate change; nowhere is this more apparent than in Assam. The Budget must go beyond ad-hoc relief and institutionalize the ‘Assam River Erosion Management Commission (AREMC)’ on scientific, basin-wise mapping. Noting that erosion is structural, the affected districts must be declared ‘chronic displacement zones,’ mandating automatic relief through a new ‘Assam River Erosion and Flood Rehabilitation Authority (ARERA).’ At the same time, national security requires a ‘Border Security Modernization Fund’ to modernize BSF posts and install indigenous high-definition thermal surveillance systems along riverine borders.
For rural economy activation, the Budget should support the UN’s 2026 Year of Women Farmers by providing a 2-3% MSP bonus on crops where the land is owned by women. In the tea industry, the mission to train 1 lakh women and set up 200 health camps is critical. Industrial support needs sector-specific focus: a National Jute Development Board (with MSP increased to ₹6,000-6,500) and a National Silk Promotion Board are required. Most importantly, to make the PLI scheme more accessible to MSMEs in these sectors, the investment requirement needs to be reduced from ₹100 crore to ₹25 crore. The Tirupur knitwear industry also needs immediate technology upgradation support and import of zero-duty yarn to remain competitive.
Soft power and future skills require equal focus. To address the imbalance in funding, ₹300 crore should be allocated to the ‘Classical Tamil Global Outreach Scheme’ and ₹150 crore to digitize ‘Thirukkural.’ For the North East, a Leadership Fellowship with ₹75,000 stipends for 450 students in top institutions will help create a pipeline of talent. For sports, a National Institute of Sports Science and an infrastructure corpus are required to professionalize sports talent development.
Finally, to bridge the gender gap in deep tech, it is recommended that “Naari AI Kendras” be established as Centres of Excellence. These hubs will provide incubation in AI and electronics for women from polytechnics, ensuring diversity in the tech workforce.
Ultimately, this year’s Budget can be expected to be decidedly industry-friendly, pro-MSME, and pro-AI. By adapting to the changing world of artificial intelligence and accommodating the digital-first preferences of GenZ, the government seems poised to present a forward-looking roadmap that balances heritage with hyper-modernity.
*Ritwik Mehta: Ritwik Mehta is the founder of a Youth Led Policy Research Think Tank Niti Tantra
