This Is Why Budget 2026 Could Surprise Markets Without Spending More

The Union Budget 2026 is expected to be a cautious, tightly balanced budget focused more on strategic prioritisation than big announcements. With tax revenues under pressure due to last year's income-tax relief, the government's major focus will be to fund rising needs, especially defence, renewable energy, and semiconductors-without breaking fiscal discipline.

As per Mr. Gaurav Garg, Research Analyst at Lemonn Markets Desk, instead of aggressive public spending, this year's budget will likely rely on a recovery in consumption and private investment to drive growth, while keeping overall capex growth moderate.

Defence, green energy, urban infrastructure, and manufacturing will see clear preference, while health, education, and traditional infrastructure get only incremental increases. Overall, Budget 2026 will emphasise disciplined spending, targeted capital allocation, and private-sector crowding."

India's VDA ecosystem is at a pivotal stage, with growing adoption across the country. However, the current tax framework presents challenges for retail participants by taxing transactions without recognising losses, creating friction rather than fairness.

A reduction in TDS on VDA transactions from 1% to 0.01% could improve liquidity, ease compliance, and enhance transparency while preserving transaction traceability. Raising the TDS threshold to Rs 5 lakh would help protect small investors from disproportionate impact.

"Introduced in 2022 as a stand-in for regulation at that time, VDA taxation has since been complemented by strong oversight from FIU-IND and improved compliance. This Budget presents a great opportunity to revisit the framework in a manner beneficial to both investors and the government. We remain hopeful that the government will recognize this gap and consider reviewing the current framework soon," said Ashish Singhal, Co-founder, CoinSwitch.

As per Balfour Manuel, Managing Director at Blue Dart, Budget 2026 has the potential to be a defining inflection point in accelerating India's logistics transformation under the PM Gati Shakti vision. Building on the progress made in recent years, the next phase of growth will depend on deeper integration of infrastructure planning across air, road, rail, and multimodal networks, supported by faster adoption of digital platforms that enable seamless coordination across the logistics value chain.

For the express logistics sector, sustained investments in airport infrastructure, cargo handling capacity, and regional air connectivity will be critical to improving turnaround times and supporting high-value, time-sensitive shipments. In parallel, wider adoption of digital enablers such as unified logistics platforms, data-driven visibility, and paperless processes - can further enhance predictability, transparency, and ease of doing business for exporters and MSMEs alike.

As sustainability becomes central to long-term competitiveness, policy levers can play a catalytic role. Differential taxation that favours greener modes of transport could accelerate modal shifts more effectively than standalone subsidies. Alongside this, focused investments in EV charging and alternative fuel infrastructure would help address practical adoption challenges, particularly across long-haul movements and urban delivery operations, enabling decarbonisation while maintaining service reliability.

Continued capital expenditure on road infrastructure, especially last-mile connectivity, will further extend reliable logistics services into Tier 2, Tier 3, and rural India - strengthening MSME participation, integrating them into national and global supply chains, and supporting inclusive growth.

A parallel focus on the logistics workforce, through skill development, stronger safety norms, and clearer frameworks for gig and delivery professionals, will be vital to building operational resilience and service quality at scale. Together, these measures can help translate the Gati Shakti vision into tangible gains for trade, exports, and national competitiveness, supporting India's journey towards a Viksit Bharat."

"Budget 2026 presents a timely opportunity to catalyse the next phase of efficiency-led growth across India's logistics sector. With the foundations of PM Gati Shakti firmly in place, the priority now must shift toward seamless physical and digital integration across air, road, rail, and multimodal corridors," said Dipanjan Banerjee, Chief Commercial Officer, Blue Dart.

Reducing dwell times, simplifying customs, and enabling smoother intermodal transfers can materially lower operating friction and bring logistics costs closer to global benchmarks which is critical for India's export ambitions. As India emerges as both a fast-evolving e-commerce consumption hub and a rising manufacturing base, logistics networks will need greater scale, speed, and predictability.

Supportive policy measures that make cross-border e-commerce easier for MSMEs, digitise trade flows and streamline documentation can unlock significant B2C export potential from Tier 2 and Tier 3 markets. At the same time, the Budget must continue to back high-growth sectors like new energy, electronics, and life sciences where specialised logistics capability and high-compliance handling are now essential enablers of industrial competitiveness.

A calibrated policy push for cleaner mobility will also be important. Rationalising taxation on green transport technologies, expanding EV charging ecosystems and accelerating pathways for Sustainable Aviation Fuel (SAF) will help future-proof logistics networks while supporting national climate goals. With customer expectations becoming more time-sensitive and value-driven, budget provisions that reward efficiency, connectivity, and sustainability will be key to helping logistics players deliver reliably at scale, powering India's economic momentum at home and abroad.