The Union Budget 2026 is expected to maintain continuity in policy priorities while placing a sharper focus on strengthening domestic consumption, amid ongoing global geopolitical uncertainty, according to a senior executive at Bertelsmann India Investments.
Jayesh Bavle, chief financial officer (CFO) at the investment firm Bertelsmann India Investments, said the government’s budgets in recent years have been characterised by a consistent approach to key policy areas and that the upcoming budget is likely to build further on this trend rather than introduce abrupt changes.
“One of the defining features of this government’s budgets has been the consistency of its focus areas, and we expect Budget 2026 to build further on this approach,” Bavle said.
He noted that global geopolitical developments and economic uncertainty have underscored the importance of reducing external vulnerabilities by strengthening domestic production and consumption. In this context, policies aimed at supporting demand within the economy are expected to assume greater significance.
Bavle said India’s current macroeconomic conditions provide the government with room to consider measures that could stimulate consumption. Factors such as relatively low inflation and a controlled fiscal deficit have created a favourable environment for targeted initiatives without compromising fiscal discipline.
“Currently prevailing positive macroeconomic factors such as low inflation and controlled fiscal deficit provide the government with a timely opportunity to roll out consumption boosting initiatives in this budget,” he said.
Union Budget 2026 — sustain economic growth with fiscal prudence
The Union Budget is presented at a time when policymakers are balancing the need to sustain economic growth with the imperative of maintaining fiscal prudence. Industry stakeholders have been watching closely for signals on whether the government will prioritise consumption-led growth, public capital expenditure or a mix of both.
On the taxation front, Bavle said he does not expect sweeping changes in Budget 2026. He welcomed the government’s move towards transitioning to a new Income Tax Act, which is aimed at simplifying India’s tax framework and making it more accessible to taxpayers.
“From a tax perspective, we do not anticipate sweeping changes and welcome the move towards the new Income Tax Act,” he said.
However, Bavle emphasised that while the proposed law is expected to have a simplified and abridged structure, the effectiveness of the transition will depend largely on the underlying rules and their implementation.
“Given its simplified and abridged structure, the underlying rules will be critical, and we look forward to greater clarity in the rules to support effective implementation and compliance,” he said.
The government has previously indicated that the proposed Income Tax Act is intended to reduce complexity, improve ease of compliance and make tax provisions easier to understand. However, detailed rules, timelines and transitional provisions are yet to be announced.
The upcoming Union Budget 2026 will be closely scrutinised by investors and businesses for cues on policy continuity, demand-side support and the pace of tax reform, as India seeks to navigate global uncertainty while sustaining domestic economic momentum.
