As India prepares for Budget 2026, financial experts are highlighting critical measures needed to maintain the country's robust economic trajectory. Ayush Nagpal, a Partner at the consulting firm SAM, has outlined key recommendations focused on enhancing tax predictability and broadening incentive programs to foster long-term growth.
The Imperative for Enhanced Tax Certainty
Nagpal stresses that boosting tax certainty should be a top priority in the upcoming budget. He argues that a stable and transparent tax regime is essential for attracting both domestic and foreign investments. Unpredictable tax policies can deter businesses from making long-term commitments, leading to reduced capital expenditure and slower economic expansion.
By providing clearer guidelines and reducing frequent changes in tax laws, the government can create a more conducive environment for business planning. This move would not only bolster investor confidence but also streamline compliance processes, making it easier for companies to operate efficiently.
Expanding Production-Linked Incentive Schemes
Another significant recommendation from Nagpal involves the expansion of Production-Linked Incentive (PLI) schemes. These initiatives have already shown promise in boosting manufacturing output and creating employment opportunities across various sectors.
Extending PLI benefits to more industries could catalyze further growth, especially in emerging sectors like renewable energy, electronics, and pharmaceuticals. Nagpal suggests that a broader application of these incentives would enhance India's competitiveness on the global stage and support the government's vision of a self-reliant economy.
Strategic Implications for Sustained Growth
The combination of improved tax certainty and expanded PLI schemes is seen as a powerful strategy to sustain India's economic momentum. Nagpal points out that these measures would address current challenges while laying a strong foundation for future development.
- Increased investor trust leading to higher FDI inflows
- Stimulated manufacturing activity and job creation
- Enhanced export potential through competitive pricing
- Reduced dependency on imports in key sectors
As Budget 2026 approaches, policymakers are expected to consider such expert insights to craft a fiscal plan that balances growth objectives with fiscal prudence. The emphasis on tax reforms and incentive expansions reflects a proactive approach to navigating global economic uncertainties and securing India's position as a leading economy.
