India Budget 2026

Positive +

Launch of India Semiconductor Mission 2.0 (ISM 2.0): Marking a strategic upgrade, the budget launched ISM 2.0 to propel India’s semiconductor ambitions. The mission now focuses on building high-value domestic capabilities in design, advanced manufacturing and a resilient supply chain, moving decisively up the technology ladder.

Positive

Increased Funding for Electronics Component Manufacturing: In a major push for supply chain resilience, ECMS funding was raised to ₹40,000 crore. This significant outlay reinforces the commitment to localize semiconductor-critical components and attract allied industrial investment alongside ISM 2.0.

Positive +

Extended Customs Duty Exemption for Nuclear Power Projects: To lower capital costs and accelerate low-carbon energy expansion, the budget will extend the customs duty exemption for nuclear project imports until 2035, broadening it to cover all plants irrespective of capacity.

Positive

Strong Long-Term Policy Support for Nuclear Capacity Growth: To reinforce sustained policy support for achieving 100 GW of nuclear capacity by 2047, the Budget aligns its extended duty benefits with this strategic goal. It further provides significant capital expenditure support through enhanced allocations to the Department of Atomic Energy

Marginally Positive

Supply chain support through rare earth: To fortify domestic supply chains for strategic inputs like rare earths, the Budget supports critical mineral value chains, a measure that directly bolsters nuclear plant construction and operations alongside other clean-energy sectors.

Positive +

Duty Exemptions to Boost Solar & Storage Manufacturing: The budget introduces zero customs duty on sodium antimonate for solar glass and BESS manufacturing equipment to help lower production costs, scale domestic solar and storage output and boost global competitiveness.

Positive

Increased Budgetary Allocation & Policy Support: The MNRE budget was boosted by nearly 24%, with sharp increases for flagship solar, grid, and bioenergy schemes, signaling a strong push to accelerate deployment and empower distributed clean power adoption across India.

Marginally Positive

Clean-Energy Ecosystem & Decarbonisation Measures: The budget's ₹20,000 crore CCUS programme supports renewables by securing supply chains and enabling industrial decarbonization. Clearer green hydrogen and storage financing would further boost the sector's competitiveness.

Positive +

Rare Earth & Critical Mineral Corridors: Budget announces Rare Earth & Critical Mineral Corridors in key states like Odisha and Tamil Nadu. This initiative aims to build a domestic exploration-to-value-addition chain for strategic minerals, powering sectors like clean energy and semiconductors while cutting import reliance.

Positive

Domestic Processing & Value-Addition: The budget provides policy and duty support to encourage the domestic processing and refining of critical minerals. This move aims to build an integrated ecosystem, bolster supply-chain resilience, and align with clean energy and advanced manufacturing goals.

Marginally Positive

Private Sector Participation: Greater clarity on auction mechanisms, environmental approvals and public-private partnership models will be key to translating these announcements into on-ground capacity creation

Positive +

Long-Term Tax Holiday for Global Data Centre Operations: To establish India as a global hub for AI and hyperscale data centers, the budget provides a long-term tax holiday extending to 2047, for foreign cloud and data service companies operating from within the country.

Positive

Safe Harbour Framework for Data Centre-Related Entities: To simplify compliance and reduce litigation, the budget introduces a safe harbour regime of ~15% profit margin for related entities in data centre and cloud operation boosting the ease of doing business and encouraging multinationals to expand their India footprint.

Marginally Positive

Indirect Infrastructure & Energy Ecosystem Support: The sector is expected to benefit indirectly from broader energy, nuclear, and clean power initiatives.

Positive +

Long-Term Tax Holiday for Global Data Centre Operations: To establish India as a global hub for AI and hyperscale data centers, the budget provides a long-term tax holiday extending to 2047, for foreign cloud and data service companies operating from within the country.

Positive

Multimodal Connectivity and Logistics Infrastructure: To support CERs, the budget emphasizes investments in multimodal transport networks, including expansion of highspeed rail corridors, dedicated freight corridors, national highways, and inland waterways. These measures are expected to lower logistics costs, improve last-mile connectivity, and enhance supply-chain efficiency across regions.

Marginally Positive

Implementation Framework and State Coordination: Effective execution will depend on inter-agency coordination, land availability, and the ability to attract private investment into CER-linked projects.