India will announce its annual budget on Sunday, with the Defence Ministry requesting more military funds, while industries are asking for lower tax rates on market transactions and customs duties. The government is also planning to ease foreign investment regulations. Finance Minister Nirmala Sitharaman will present the budget for the fiscal year starting in April at 11 a.m. (0530 GMT).
Economists predict a focus on reducing government debt to 49%-51% of GDP by 2031, down from 56%. The fiscal deficit is expected to be set at 4.2% of GDP for 2026-27, a decrease from 4.4% this year, while gross borrowing may rise to 16 trillion to 16.8 trillion rupees ($174 billion-$183 billion) from 14.6 trillion rupees this year.
The Defence Ministry is seeking a 20% increase in military spending after recent tensions with Pakistan, with plans to simplify foreign investment in defence. The Federation of Indian Chambers of Commerce wants new initiatives to boost defence exports. Economists anticipate capital spending will stay around 3.1% of GDP.
Export organizations are urging lower import duties to help their industries. Tax experts are calling for the removal of the securities-transaction tax and changes to income-tax rules to aid contract manufacturing.
With information from Reuters
