Jubilee Post News & Views
Prabhat Chaturvedi
Union Budget 2026 signals strong continuity in India’s long-term development strategy, underlining the government’s commitment to structural reforms and global competitiveness. The budget reinforces India’s position as a dependable economic leader, with policy measures aimed at strengthening institutions, improving capital efficiency, and supporting inclusive growth.
A major highlight of the budget is its cooperative-focused tax reforms. Deductions for member-produced cattle feed and cotton seed, along with exemptions on inter-cooperative dividends, are expected to deepen income linkages within the cooperative ecosystem. These steps will improve capital circulation, enhance balance sheet efficiency, and strengthen federated cooperatives. The time-bound dividend exemption for national cooperative federations is likely to help them mobilise additional resources and reinvest capital into member institutions.
The proposal to set up a high-level committee on Banking for Viksit Bharat is being seen as a timely macro-financial intervention. As India transitions towards more credit- and investment-led growth, the need for a future-ready banking system has become critical. A comprehensive structural review of the sector can improve capital deployment, strengthen risk monitoring frameworks, and address emerging balance sheet pressures. This is expected to make credit expansion safer, more productive, and inclusive, while maintaining financial stability and customer confidence.
The budget also provides a significant boost to the MSME sector. The proposed ₹10,000 crore SME Growth Fund and risk-capital support are aimed at strengthening long-term bankability of small and medium enterprises. The introduction of a ‘Corporate Mitras’ network is another key reform, offering affordable compliance and advisory support to MSMEs. This initiative is expected to accelerate formalisation, improve financial discipline, and enhance overall enterprise quality.
For rural development and women empowerment, the budget proposes SHE-Marts for women-led rural enterprises. These community-owned retail hubs are expected to strengthen local supply chains, promote grassroots entrepreneurship, and build long-term social and financial resilience in rural areas.
The government’s push towards digital infrastructure has also been welcomed by industry. A tax holiday until 2047 for foreign cloud service providers using Indian data centres, along with a 15 per cent safe harbour for related entities, positions India strategically as a global digital infrastructure hub. These measures are expected to attract large-scale investments, create high-skilled jobs, and indirectly support faster digitisation of the financial ecosystem through cost-effective technology infrastructure.
Overall, Union Budget 2026 reflects a calibrated approach focused on institutional strengthening, sustainable growth, and long-term economic resilience.
(These are the author’s personal views.) (The author is CEO, National Urban Cooperative Finance and Development Corporation Ltd. (NUCFDC))
