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Modi Government Prepares Budget 2026: Economists' Consultations Underway

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  //business-finance.news-articles.net/content/202 .. dget-2026-economists-consultations-underway.html
  Published in Business and Finance on Tuesday, December 30th 2025 at 0:12 GMT by Business Today

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Modi Government Gears Up for Budget 2026: Economists’ Consultations Signal Focus on Growth & Fiscal Prudence

The Indian government is entering the final phase of preparations for the Union Budget 2026, with Prime Minister Narendra Modi scheduled to meet a panel of leading economists today (December 30th, 2025). This meeting signals a concerted effort to fine-tune fiscal policy amidst a backdrop of global economic uncertainty and domestic growth aspirations. The consultations are particularly significant as the government navigates the delicate balance between stimulating economic activity and maintaining fiscal discipline, especially with an eye on potential electoral considerations in the upcoming year.

The Business Today article highlights that this isn't just another routine pre-budget consultation; it’s a crucial step as the Modi administration aims to solidify its economic roadmap for the next five years. The timing is deliberate – with the budget likely to be presented in early 2026, these discussions are intended to incorporate expert perspectives and address potential challenges before formal policy decisions are finalized.

Key Themes Expected to Dominate Discussions:

Based on reports and expectations surrounding the meeting, several key themes are anticipated to dominate the conversation between the Prime Minister and the economists. These include:

• Sustaining Economic Growth: India's economy has shown resilience despite global headwinds, but maintaining a high growth trajectory remains paramount. The government is likely seeking advice on strategies to bolster investment, particularly in infrastructure development (roads, railways, ports) and manufacturing. The "Make in India" initiative, while having seen some success, will undoubtedly be under scrutiny regarding its effectiveness and potential for further expansion. Boosting private sector participation in these projects is a key area of focus.
• Fiscal Consolidation: While growth is vital, the government also faces pressure to reduce the fiscal deficit. The article mentions that Finance Minister Nirmala Sitharaman has repeatedly emphasized the importance of fiscal prudence. Balancing this with the need for public spending on social programs and infrastructure will be a central challenge. The economists are expected to provide insights into sustainable pathways for achieving these goals, potentially involving revenue enhancement measures alongside expenditure rationalization.
• Inflation Management: While inflation has moderated from its peak in recent years, it remains a concern globally. The Reserve Bank of India (RBI), as detailed in related reports and analyses, is closely monitoring inflationary pressures and adjusting monetary policy accordingly. The government's role in ensuring price stability through supply-side interventions and efficient distribution mechanisms will likely be discussed.
• Job Creation: Creating employment opportunities, particularly for the youth, remains a critical priority. The economists are expected to offer suggestions on policies that can stimulate job growth across various sectors, including skill development programs and support for small and medium enterprises (SMEs). The article notes the importance of fostering entrepreneurship as a key driver of job creation.
• Agricultural Reforms: While significant reforms have been attempted in the agricultural sector, challenges persist regarding farmer incomes, market access, and climate change resilience. The economists are likely to provide recommendations on further improvements to agricultural infrastructure, irrigation facilities, and support for sustainable farming practices. The ongoing debate around Minimum Support Prices (MSPs) and procurement policies could also feature prominently.
• Global Economic Outlook: The meeting will undoubtedly address the impact of global economic uncertainties – including geopolitical tensions, trade wars, and fluctuations in commodity prices – on India’s economy. Strategies to mitigate these risks and capitalize on emerging opportunities are expected to be explored.

The Economists' Panel & Their Perspectives:

While the article doesn't explicitly list all participating economists, it implies a diverse group representing various schools of thought within the Indian economic landscape. Their collective input is crucial for providing a comprehensive assessment of the current economic situation and offering policy recommendations that are both pragmatic and impactful. The government values these consultations as a way to ensure its budget proposals are well-informed and aligned with expert perspectives.

Budget 2026: Context & Potential Priorities:

The upcoming Union Budget 2026 arrives at a pivotal moment for the Indian economy. Following the COVID-19 pandemic, the government has implemented various stimulus measures to support growth. Now, the focus is shifting towards consolidating these gains and laying the foundation for sustained long-term development. The article suggests that the budget could prioritize:

• Infrastructure Spending: Continued investment in infrastructure projects will be crucial for boosting economic activity and creating jobs.
• Healthcare & Education: Strengthening healthcare systems and improving access to quality education remain key social priorities.
• Digital Infrastructure: Expanding digital connectivity and promoting digital literacy are essential for inclusive growth.
• Green Initiatives: Promoting sustainable development and addressing climate change will be increasingly important, potentially through incentives for renewable energy adoption and investments in green technologies.

Conclusion:

The Prime Minister’s meeting with economists underscores the government's commitment to evidence-based policymaking and collaborative governance. The discussions are expected to shape the contours of the Union Budget 2026, influencing key decisions related to growth, fiscal consolidation, inflation management, and job creation. As India navigates a complex global economic landscape, these consultations will be instrumental in ensuring that the budget aligns with national priorities and contributes to sustained and inclusive economic development for all citizens. The final budget document is eagerly awaited by businesses, economists, and the public alike, as it will provide a clear roadmap for India's economic future.

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