Union Budget 2026-27 Receives Positive Feedback from Gulf NRI Businesses with Key Initiatives

The Union Budget 2026-27 has been largely well-received by Indian businesses in the UAE and the Gulf region. Many praised the focus on semiconductors, though some suggested more attention to welfare schemes. Finance Minister Nirmala Sitharaman highlighted the India Semiconductor Mission 2.0, which aims to develop equipment and materials for full-stack Indian intellectual property.

Kamal Vachani, Deputy CEO of Al Maya Group, expressed approval for the India Semiconductor Mission 2.0. He noted that semiconductors are vital for electronics, telecom, automotive technology, defence systems, and AI. Historically, India has imported many chips. The mission seeks to boost domestic production, reducing reliance on foreign supply chains and lowering strategic risks and import costs.

Focus on Domestic Manufacturing

The budget also announced a Rs 10,000 crore SME Growth Fund to support small and medium enterprises with high growth potential. Vachani mentioned that increasing the outlay for the Electronics Component Manufacturing Scheme to Rs 40,000 crore will enhance domestic manufacturing of electronic components. This move is expected to encourage more companies to establish production units for items like PCBs, camera modules, display parts, and batteries.

Arun Chulani, co-founder at First Water, described the budget as generally neutral. It continues the government's focus on infrastructure, manufacturing, and digital transformation. However, Chulani had mixed feelings about the proposal to increase the Securities Transaction Tax (STT) on futures and options.

Impact on Financial Markets

The finance minister proposed raising the STT on futures from 0.02% to 0.05%. The STT on options premium and exercise of options will increase from 0.1% and 0.125% to 0.15%, respectively. While some market participants were unhappy with this change, Chulani believes it's crucial to ensure a nation of investors rather than speculators. He cited a SEBI report indicating that over 90% of participants lose in the F&O equity markets.

Chandrashekhar Bhatia, chairman of GBF Middle East, emphasised India's role in global growth. He stated that as India sets the tone for worldwide development, its budget becomes increasingly significant not just for Indians but globally. According to Bhatia, the government's reform-oriented budget will have an impact over the next five to ten years.

Strengthening India's Digital Economy

Bhavesh Talreja, founder & CEO of Globale Media, remarked that the budget sends a strong message to global markets about India's stable and scalable digital economy. With ongoing investments in digital public infrastructure and AI enablement, India is boosting confidence among international advertisers and investors seeking diversification beyond Western markets.

Talreja added that for the global AdTech industry, this budget reinforces India's position as both a demand market and an execution hub. Clearer regulatory direction around data and continued support for innovation-driven sectors make cross-border collaboration more predictable and sustainable.

This budget not only supports domestic growth but also deepens India's integration into the global digital advertising value chain.

With inputs from PTI