Budget 2026: Eight Budgets of change behind, is this FM Sitharaman’s toughest test yet?

Finance Minister Nirmala Sitharaman is set to present her ninth consecutive Union Budget in Parliament on February 1, 2026 (Sunday), a rare milestone that underscores continuity in India’s fiscal policymaking. Budget 2026 will be framed against the backdrop of heightened global uncertainty -- marked by geopolitical tensions, slowing growth in advanced economies, volatile commodity prices and shifting capital flows -- at a time when India is seeking to protect growth momentum while maintaining fiscal discipline.

Since taking charge in 2019, FM Sitharaman has delivered eight straight Budgets, including an interim Budget in February 2024. Over the past seven years, India’s Union Budgets, from FY2019-20 to FY2025-26, have largely revolved around economic recovery, structural reforms, infrastructure expansion, tax rationalisation and social welfare, with an increasing emphasis on long-term growth enablers rather than short-term populism.

2019 Budget

The 2019 Budget, her first, set the tone with the ambitious goal of making India a $5 trillion economy by FY25. It raised the standard deduction for salaried employees, expanded tax rebates for lower-income earners, and rolled out the PM-KISAN income support scheme for farmers. Later that year, a landmark corporate tax cut—reducing the base rate to 22% and offering a 15% rate for new manufacturing firms—signalled a decisive push to revive private investment.

2020 Budget

In 2020, the government unveiled a new optional income tax regime with lower rates but fewer exemptions, abolished the dividend distribution tax, and announced plans for the LIC IPO. The Budget also boosted allocations for agriculture and healthcare, while laying out futuristic initiatives such as the National Mission on Quantum Technologies, just weeks before the COVID-19 pandemic upended economic assumptions.

2021 Budget

The 2021 Budget, presented amid the pandemic, sharply increased healthcare spending and prioritised public infrastructure as a growth engine. Massive allocations were announced for water supply under the Jal Jeevan Mission, waste management through Swachh Bharat Mission 2.0, and manufacturing via production-linked incentive (PLI) schemes across 13 sectors. Capital expenditure emerged as the central lever of recovery, even as fiscal deficits widened.

2022 Budget

By 2022, the focus shifted to digitalisation and green growth. The government introduced taxation on virtual digital assets, announced a central bank digital currency, and raised capital expenditure by 35%. Support for MSMEs was extended, interest-free loans were offered to states for infrastructure, and green bonds were proposed to fund sustainable projects.

2023 Budget

The 2023 Budget refined the new tax regime to make it more attractive, increased capital expenditure to ₹10 lakh crore, and placed renewed emphasis on railways, housing and green initiatives under the broader “Amrit Kaal” vision. Social sector interventions, including healthcare expansion and education infrastructure, continued alongside fiscal consolidation.

2024 Budget

In 2024, tax reforms took centre stage again, with revised slabs under the new regime, a higher standard deduction, abolition of the angel tax for startups, and rationalisation of capital gains taxation. Large allocations for rural development, agriculture and infrastructure reinforced the government’s employment and growth priorities.

2025 Budget

The most recent 2025 Budget marked a significant shift by making income up to Rs 12 lakh tax-free under the new tax regime, further simplifying personal taxation. It raised FDI limits in insurance, expanded MSME credit guarantees, launched new agricultural and urban development missions, and unveiled a Nuclear Energy Mission. Fiscal deficit targets continued to glide lower even as capital expenditure remained elevated.

As Budget 2026 approaches, expectations are that Sitharaman will build on this legacy, balancing growth support with fiscal prudence, deepening structural reforms, and navigating global headwinds, while setting the tone for India’s medium-term economic trajectory.