Union Budget 2026–27 Puts Exports at Centre of India’s Growth Strategy

New Delhi: The Union Budget 2026–27 has placed international trade and exports at the core of India’s long-term growth strategy, outlining a comprehensive reform and investment roadmap to build a competitive, resilient and globally integrated economy. Anchored in macroeconomic stability, fiscal discipline and sustained public capital expenditure, the Budget reinforces the Government’s commitment to positioning India as a trusted global trading partner and advancing the vision of Viksit Bharat.

Recognising exports as a key engine for employment generation, industrial upgrading, foreign exchange earnings and integration into global value chains, the Budget announces a wide-ranging set of measures cutting across manufacturing, services, Special Economic Zones (SEZs), infrastructure development, ease of doing business and sector-specific reforms.

A major thrust of the Budget is on scaling up domestic manufacturing in strategic and labour-intensive sectors to enhance export competitiveness and reduce critical import dependence. Flagship initiatives include Biopharma SHAKTI, the launch of India Semiconductor Mission 2.0, expansion of the Electronics Components Manufacturing Scheme, development of Rare Earth Corridors, establishment of Chemical Parks, and targeted support for capital goods and container manufacturing.

Labour-intensive sectors such as textiles, footwear, sports goods, handicrafts and handlooms receive renewed policy focus through integrated industrial parks, modernisation schemes, skilling initiatives, cluster rejuvenation and sustainability-linked programmes. The revival of 200 legacy industrial clusters through infrastructure and technology upgradation is expected to lower costs, improve productivity and restore the competitiveness of traditional export hubs.

The gems and jewellery sector, one of India’s largest foreign exchange earners, is set to benefit from multiple trade facilitation measures. The removal of the ₹10 lakh value cap on courier exports will provide a boost to small exporters and e-commerce-led shipments, while improved handling of returned consignments will ease global B2C trade. Extensions of concessional customs duty regimes for gold and silver dore bars and lab-grown diamond inputs will further support domestic refining and value addition.

The services sector has received a strong policy push in the Budget. A High-Powered Education-to-Empowerment and Enterprise Standing Committee has been proposed to guide coordinated reforms and position India as a global services powerhouse, with an aspirational target of securing a 10 per cent share in global services exports by 2047. Targeted tax and regulatory reforms for IT and IT-enabled services—such as unified classification of IT services, higher safe-harbour thresholds, automated approvals, faster Advance Pricing Agreements and long-term policy certainty—are expected to strengthen India’s attractiveness for Global Capability Centres (GCCs) and international service providers.

In a significant move to boost digital exports, the Budget proposes tax holidays up to 2047 for foreign companies providing global cloud services through India-based data centres, along with safe-harbour norms for related-party services. These measures are expected to accelerate foreign investment, deepen digital infrastructure and position India as a global hub for data-driven services.

Reforms in Special Economic Zones aim to enhance capacity utilisation, economies of scale and resilience while maintaining export orientation. One-time facilitation for limited Domestic Tariff Area sales at concessional duties and extended tax incentives for cloud and data-centre operations are expected to attract global manufacturers and technology players.

A strong infrastructure push underpins the export strategy. Increased public capital expenditure, expansion of Dedicated Freight Corridors, development of National Waterways, promotion of coastal shipping, logistics parks, container manufacturing and high-speed rail corridors are expected to significantly reduce logistics costs, particularly for exporters in tier-2 and tier-3 cities.

The Budget also advances a trust-based, technology-driven trade facilitation framework. Measures such as electronic sealing of export cargo, trusted supply-chain recognition, automated customs processes, expanded non-intrusive scanning, longer validity of advance rulings, enhanced duty deferment for Authorised Economic Operators and removal of courier export value caps aim to reduce transaction costs and improve predictability.

Micro, Small and Medium Enterprises (MSMEs), which form the backbone of India’s export ecosystem, receive focused support through a ₹10,000 crore SME Growth Fund, enhanced credit guarantee mechanisms, mandatory onboarding of CPSEs on TReDS, and integration of GeM with TReDS to improve access to timely and affordable finance.

Sector-specific initiatives spanning agriculture, marine products, pharmaceuticals, tourism, AVGC and allied health services further expand India’s export opportunities and reinforce a diversified export base.

Overall, the Union Budget 2026–27 presents a coherent and forward-looking trade and export strategy—combining competitive manufacturing, services excellence, logistics modernisation, regulatory simplification and infrastructure investment—laying a strong foundation for sustained export growth, job creation and long-term economic resilience.