New Delhi, March 27: Parliament approved the Finance Bill 2026 on Friday. The Rajya Sabha returned it to the Lok Sabha via a voice vote, completing the legislative process to provide legal backing for the central budget proposals for 2026-27, which will take effect from April 1.
The Lok Sabha passed the bill on March 25 with 32 amendments. Following a brief discussion in the Rajya Sabha, Finance Minister Nirmala Sitharaman addressed questions from MPs before the bill received approval.
The central budget for 2026-27 allocates a total expenditure of ₹53.47 lakh crore, reflecting a 7.7% increase compared to the current financial year (ending March 31).
This budget proposes a capital expenditure of ₹12.2 lakh crore for major infrastructure projects, aimed at boosting economic growth and employment, which is ₹2.2 lakh crore more than last year.
To expedite the completion of large projects, an ‘Infrastructure Risk Development Fund’ will be established, according to the Finance Minister.
She also set a target to reduce the fiscal deficit to 4.3% of GDP for 2026-27. The government is working to maintain financial stability alongside economic growth. The fiscal deficit represents the gap between the government’s total expenditure and total revenue.
To cover this deficit in the fiscal year 2027, the government plans to net borrow ₹11.7 lakh crore, with total market borrowing estimated at ₹17.2 lakh crore.
The budget emphasizes strengthening infrastructure sectors such as highways, ports, railways, and power projects, while also focusing on increasing manufacturing in seven strategic sectors and promoting MSMEs.
The Finance Minister stated that the government is committed to maintaining a strong focus on public investment while ensuring financial discipline and monetary stability.
She also noted that India’s debt-to-GDP ratio decreased to 56.1% in the fiscal year 2025-26, with a target to further reduce it to 55.6% in 2026-27.
A reduction in this ratio will lessen the burden of interest payments, helping to keep the fiscal deficit low and providing more resources for developmental activities.
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