Published: 31 January 2026PIBEconomy
Union Budget 2026-27: Fiscal Deficit Targeted at 4.3% of GDP; Capex Raised to ₹12.2 Lakh Crore
Finance Minister Nirmala Sitharaman presented the Union Budget 2026-27 in Parliament on February 1, 2026. Total expenditure was pegged at ₹53.5 lakh crore with non-debt receipts at ₹36.5 lakh crore and net tax receipts at ₹28.7 lakh crore. The fiscal deficit target was set at 4.3% of GDP, down from 4.4% in the revised estimate of 2025-26. The debt-to-GDP ratio is estimated at 55.6%, with a target of 50% by 2030-31.
Public capital expenditure was raised to ₹12.2 lakh crore (3.1% of GDP), up from ₹11.2 lakh crore in 2025-26, an increase of about 11.5%. Effective capital expenditure, including grants to states, stands at ₹17.1 lakh crore (4.4% of GDP). Gross market borrowings were budgeted at ₹17.2 lakh crore. The budget was built on three 'Kartavyas' — fuelling growth, fostering inclusive development, and driving innovation.
Mains angle
Q: Examine the fiscal consolidation strategy and capital expenditure thrust of Union Budget 2026-27 in driving inclusive growth.
Answer (50 words): Finance Minister Sitharaman presented the Union Budget 2026-27 on February 1, 2026 with total expenditure of ₹53.5 lakh crore. The fiscal deficit was targeted at 4.3 per cent of GDP, down from 4.4 per cent. Capital expenditure rose 11.5 per cent to ₹12.2 lakh crore, supporting growth, capacity building and meaningful participation.
6-axis classification
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Practice MCQ from this story
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Linked questionMedium
What is the net tax receipts estimate in Union Budget 2026-27?
Explanation · Correct answer DNet tax receipts estimated at ₹28.7 lakh crore in Budget 2026-27.
Frequently asked questions
What is the fiscal deficit target in Union Budget 2026-27 and how does it compare to previous year?
The **fiscal deficit target in Union Budget 2026-27 is 4.3% of GDP**, reduced from **4.4% in the revised estimate of 2025-26**. This continues India's **fiscal consolidation path** with a target to bring the **debt-to-GDP ratio from 55.6% to 50% by 2030-31**.
What is the capital expenditure allocation in Union Budget 2026-27 and by how much did it increase?
**Public capital expenditure was raised to ₹12.2 lakh crore (3.1% of GDP)** in Union Budget 2026-27, up from **₹11.2 lakh crore in 2025-26** — an increase of about **11.5%**. **Effective capital expenditure** including grants to states stands at **₹17.1 lakh crore (4.4% of GDP)**.
What are the three Kartavyas (duties) that guided the formulation of Union Budget 2026-27?
Union Budget 2026-27 was built on three **Kartavyas (duties)**: **1. Fuelling growth** — driving economic expansion through capex and investment; **2. Fostering inclusive development** — ensuring benefits reach all sections; **3. Driving innovation** — investing in technology, semiconductors, and future industries. These reflect Finance Minister Nirmala Sitharaman's vision for India's development trajectory.
What are the total expenditure and tax receipts in Union Budget 2026-27?
In Union Budget 2026-27: **Total expenditure is ₹53.5 lakh crore**; **Non-debt receipts: ₹36.5 lakh crore**; **Net tax receipts: ₹28.7 lakh crore**; **Gross market borrowings: ₹17.2 lakh crore**. The budget was presented by Finance Minister **Nirmala Sitharaman** on **February 1, 2026**.
What is the debt-to-GDP ratio in Budget 2026-27 and what is the fiscal consolidation target?
The **debt-to-GDP ratio is estimated at 55.6%** in Union Budget 2026-27. India's **fiscal consolidation roadmap targets reducing this to 50% by 2030-31**. The fiscal deficit of **4.3% of GDP** is a step toward this medium-term consolidation goal, down from 4.4% in FY 2025-26 revised estimates.
