The pension outlay for armed forces personnel, which forms a significant chunk of the annual defence budget, has seen a marginal increase of 1.27 per cent for the 2026-27 financial year over the current fiscal.
In her Budget, Finance Minister Nirmala Sitharaman has proposed an allocation of Rs 1,71,338.22 crore for pensions and other retirement benefits for the three services. The revised estimate for the 2025-26 fiscal was Rs 1,69,186.50 crore, whereas the actual expenditure for the 2024-25 fiscal was Rs 1,57,653.65 crore, according to data in the budget documents.
According to government data shared with Parliament in 2025, there are about 28 lakh registered ex-servicemen in the country. The figure includes about 24 lakh from the Army, 2.26 lakh from the Air Force and 1.5 lakh from the Navy. In addition, there are pensioners residing in Nepal who have served in the Indian armed forces.
Uttar Pradesh has the highest number of ex-servicemen among all states and union territories in the country, followed by Punjab and Rajasthan. Other states having a relatively higher population of ex-servicemen are Maharashtra, Kerala, Haryana, Himachal Pradesh, Bihar, Uttarakhand and Tamil Nadu.
The allocation for the Ex-servicemen Contributory Heath Scheme (ECHS), which has in the past come under fire for inadequate budgetary support, has also been enhanced. With a clientele base of 55 lakh beneficiaries, the scheme provides cashless medical cover facilities to ex-servicemen and their dependants through a network of 450 polyclinics and about 2,700 empanelled hospitals, diagnostic facilities and clinical laboratories.The ECHS revenue expenditure for 2026-27 has been proposed at Rs 12,100 crore compared to the revised estimates of Rs 11,000 crore for 2025-26 and the actual expenditure of Rs 10,914.78 crore for 2024-25. The capital expenditure for 2026-27 has been proposed at Rs 60 crore against the revised estimate of Rs 50 crore for 2025-26 and the actual expenditure of Rs 14.42 crore for 2024-25.
The capital expenditure is meant for creating assets like buildings and equipment for the long term while the revenue expenditure covers daily operating costs like salaries, utilities and miscellaneous expenditure.
Pay and allowances for armed forces forms 47% of defence ministry’s revenue outlay
The proposed allocations mark an increase of over six per cent over the revised estimates of Rs 1,60,961.09 crore for the 2025-26 fiscal
Pay and allowances for the armed forces make up about 47 per cent of the revenue component of the defence budget of the 2026-27 fiscal presented in the Parliament by Finance Minister Nirmala Sitharaman on Sunday.
The total outlay under this head has been proposed at Rs 1,71,043.82 crore, which includes the emoluments of regular armed forces personnel as well as auxiliary forces and civilian employees, including staff engaged in research and development in the three services.
The proposed allocations mark an increase of over six per cent over the revised estimates of Rs 1,60,961.09 crore for the 2025-26 fiscal, according to figures mentioned in the budget documents.
The revenue expenditure of the ministry is pegged at Rs 3,65,478.98 crore. This includes establishment expenditure under heads such as pay and allowances Ex-servicemen Contributory Health Scheme, works, Rashtriya Rifles, NCC, Agnipath, training, research and development, as well as other Central sector expenditure like transport, stores, spectrum charges, repairs and refit and general services.
The proposed expenditure of Rs 1,71,338.22 crore on defence pensions and retirement benefits for 2026-27 are listed separately under a different demand head. Expenditure to be incurred on several other civil establishments under the defence ministry come under a different head.
Revenue expenditure is used for carrying out day to day business and includes salaries, utilities, rent, maintenance, work travel and miscellaneous expenses, but does not involve building assets and procuring equipment for the long term, which come under the budget’s capital outlay.
For the 2026-27 fiscal, pay and allowances have been pegged at Rs 1,18,167.91 crore for the Army, Rs 20,536.83 crore for the Air Force and Rs 9,662.50 for the Navy. For the auxiliary forces, civilian employees in all three services and research and development staff, including service personnel, the combined allocation is Rs 22,676.58 crore.
India has the world’s third largest military in terms of manpower. The combined strength of armed forces personnel in India is a little over 14 lakh uniformed personnel, with the Army constituting the largest component. In addition, there are civilian employees who do not come under the purview of the Army, Navy or Air Force Acts and are engaged in administrative, support and ancillary services.
India’s Defence sector gets 15% increase in budget allocation
Finance Minister Nirmala Sitharaman has proposed a sharp focus on new equipment
The first Union Budget after Operation Sindoor saw an increase of 15 per cent for India’s military spending, one of the biggest annual hikes. It also has a significant 21 per cent hike in Capital spending — needed for new weapons, systems, arsenal, including jets, ships, submarines and guns.
Focusing on self-reliance, modernisation, technology infusion and infrastructure-building in border areas, Finance Minister Nirmala Sitharaman proposed a sum of Rs 7,84,678 crore for the fiscal commencing April 1. This is 15 per cent more than the Rs 6,81,210-crore allocation for the ongoing fiscal to the Ministry of Defence.
The allocation for capital is Rs 2,19,306 crore and that is a 21- per cent jump over the Rs 1,80,000 crore and is in line with the Ministry of Defence (MoD) projection seeking a hike of 20 per cent in the capital acquisition. This is intended to address ‘committed liabilities’ and high-tech procurements like the 114 Rafale fighter jets or the contract signing of the next generation submarines being offered by ThyssenKrupp Marine Systems (TKMS) of Germany in partnership with Mazagon Docks Shipbuilders Limited (MDL).
Air Marshal Inderpal Singh Walia takes over as Eastern Air Command chief
An alumnus of the National Defence Academy, Air Marshal Walia was commissioned into the fighter stream of the IAF on June 11, 1988. A highly experienced combat pilot, he is qualified on multiple aircraft platforms, including the MiG-21, MiG-23, MiG-27, Jaguar and Su-30 MKI.
He has logged over 3,200 hours of accident- and incident-free flying during his distinguished career spanning more than three decades.
Over the years, Air Marshal Walia has held several key command and staff appointments. He has commanded a MiG-27 squadron, the Tactics and Air Combat Development Establishment (TACDE), and a frontline air base as Air Officer Commanding. He is a Fighter Strike Leader and an Instrument Rating Instructor and Examiner (IRIE). He has also completed the Advance Command and Staff Course in the United Kingdom and attended the National Defence College in Bangladesh.
In his diplomatic assignment, he served as Defence Attach at the Indian embassies in Japan and South Korea. His other significant appointments include Air Commodore at the Directorate of Air Staff Inspection (DASI), Assistant Chief of Air Staff (Training) at Air Headquarters, and Air Defence Commander at Headquarters Western Air Command.
Prior to his present appointment, he was serving as the Senior Air Staff Officer at Headquarters Eastern Air Command.
In recognition of his distinguished service, he was awarded the Vayu Sena Medal in 2008 and the Ati Vishisht Seva Medal in 2018.
Air Marshal Walia succeeds Air Marshal Surat Singh, who superannuated on January 31, 2026, after 39 years of distinguished service to the nation.
WHO WON?WHO LOST? Lt. Gen (Retd.) KJS Dhillon VSM EXPLAINS
An outreach programme was organised under Mis sion Hardik Milan 4.0 for ex-servicemen, war widows (Veer Naris) and their dependents at the District Defence Services Welfare Office, Ludhiana. The programme aimed to create awareness about post-retirement pension related facilities, entitle ments and welfare provi sions available to veterans and their families. Officials from the Punjab Regimental Centre Record Office, Ramgarh Cantonment (Jharkhand), heard pen sion-related grievances of ex-servicemen, widows and dependents and re solved several issues on the spot. Matters pertain ing to other institutions were duly recorded, and beneficiaries were as sured of early resolution after submission of the required documents. Members of the Har dik Milan team, includ ing Subedar Clerk Vivek Kumar Singh and Naik Clerk Gunjit Singh, were present on the occasion. Senior officials of the District Defence Services Welfare Office, Ludhiana, including Group Captain Davinder Singh Dhillon (Retd), Superintendent Rakesh Kumar Sharma, Subedar Major Clerk Kul want Singh from the Vet eran Assistance Centre, and other staff members appreciated the welfare initiative. They lauded the ef forts of Brigadier Sajesh Babu PG, Commandant, Punjab Regimental Cen tre, Lieutenant Colonel Devashish Dey, Com manding Officer, Punjab Record Office, and their team for conducting the commendable outreach programme in the inter est of veterans and their families
PM Modi renames Adampur airport after Sri Guru Ravidas Ji, inaugurates civil terminal of Halwara airport
NARINDER GUPTA PUNJAB EXPRESS BUREAU Jalandhar, Febuary 1 Prime Minister Narendra Modi on Sunday unveiled the new name of the Ad ampur airport here as Sri Guru Ravidass Maharaj Ji Airport, Adampur and also virtually inaugurated the terminal building at the Halwara airport in Ludhiana. The Prime Minister reached the Adampur airport at around 3.45 pm from Delhi following the presentation of the Union Budget in Parliament. Meanwhile, the PM virtually inaugurated the terminal building of the Halwara airport in Lud hiana, which will further advance aviation infra structure in Punjab. Developed at the Indian Air Force base in Halwara in the Raikot subdivision, the civil terminal is ex pected to significantly enhance air connectiv ity and boost industrial and economic growth in the region. The airport’s terminal building proj ect is a Rs 54.67-crore joint venture between the Punjab government and the Airports Authority of India
On the occasion, Union Civil Aviation minister Ram Mohan Naidu Kin jarapu, Punjab Chief Minister Bhagwant Mann, Union Minister Ravneet Singh Bittu and other dignitaries were present at the Halwara airport in Ludhiana. Tight security arrange ments have been made for PM Modi’s Jaland har visit. The operationalization of Halwara airport’s ter minal building is expected to enhance air connectivity in the region significantly, providing a boost to in dustrial activity, tourism, healthcare, and education, and thereby contributing to the overall socio-economic development of Punjab, of ficials said
Prime Minister Narendra Modi on Sunday visited the Dera Sachkhand Ballan here and paid tributes to Sri Guru Ravidas Ji on the occasion of 649th birth anniversary of the saint, who is re membered as a social reformer and poet. Modi’s visit to the dera came days after the sect’s head Sant Niranjan Dass was chosen for Padma Shri, the fourth highest civilian award, on January 25. The Dera Sachkhand, located at Ballan in Jaland har, is the largest dera of Ravidassia community in the state. “Mein Punjab di iss dharti nu na man karda haan,” said the prime minister as he greeted people on the occasion of Guru Ravidas Jayanti and the Magh Purnima. Modi, who represents Varanasi in the Lok Sabha, told the gathering that the constituency also happens to be the birthplace of Sri Guru Ravidas Ji .
Union Budget 2026: Capex up, tax holiday for data centres; no change in income tax rates
Finance Minister Nirmala Sitharaman presents the ‘Union Budget 2026-27’ in the Lok Sabha, in New Delhi, Sunday, February 1, 2026.(Sansad TV via PTI)
Union Finance Minister Nirmala Sitharaman on Sunday said the government has chosen the path of reforms over rhetoric. Presenting the Budget for 2026-27 in Lok Sabha, she said India will continue to take steps towards becoming a Viksit Bharat.
The Finance Minister also laid the 16th Finance Commission report for tax revenue devolution between the Centre and states for 2026-2031. This Union Budget is Finance Minister Nirmala Sitharaman’s 9th consecutive Budget.
This takes Sitharaman closer to the record of 10 budgets that were presented by former Prime Minister Morarji Desai over different time periods.
Over Rs 95,000 crore allocated for VB-G RAM G, MGNREGA gets Rs 30,000 crore in Budget
February 1, 2026 2:26 pm
As the VB-G RAM G scheme is set to be rolled out, the Centre has allocated Rs 95,692.31 crore for it, while an allocation of Rs 30,000 crore has been made for the MGNREGA. The Viksit Bharat-Guarantee for Rozgar Aajeevika Mission (Grameen) (VB-G RAM G), which promises 125 days of work in a year, will replace the two-decade-old UPA-era rural employment scheme framed under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), 2005. The MGNREGA scheme will continue till the VB-G RAM G is implemented, and the pending works are completed, Rural Development Ministry officials have said.
This year’s Budget is foundation for our journey towards Viksit Bharat by 2047: PM Modi
February 1, 2026 2:15 pm
PM Modi says the budget strengthens foundation of India’s bright future. “This year’s budget will give India’s ‘reform express’ new energy and momentum,” says the PM.
Highway of opportunities: PM Modi on Union Budget
February 1, 2026 2:14 pm
Budget is historic; reflects empowered presence of nation’s feminine strength, says the PM.
Jammu and Kashmir allocated Rs 43,290 crore in Union Budget
FM wraps up her Budget speech, no changes in income tax rates proposed this year after last year’s mega announcements.
Approval required for cargo clearances will be seamlessly processed through a single window by year end: Sitharaman
February 1, 2026 12:37 pm
Govt to exempt duty on fish catch by Indian fishing vessels in exclusive economic zones or high seas; to revise provisions related to baggage clearance during international travel to address genuine concerns of passengers.
Customs duty exemption on video games manufacturing parts removed from April 1: Sitharaman
February 1, 2026 12:37 pm
Customs duty on TV equipment, cameras and other instruments imported by a foreign film unit or TV team for shooting films removed from April 1.
Govt to support Artificial Limbs Manufacturing Corporation of India to scale up production of assistive devices: FM Sitharaman
February 1, 2026 12:35 pm
Budget exempts parts used to manufacture microwave ovens from basic customs duty, says FM Sitharaman.
Validity for advance period, binding on Customs, extended from 3 years to 5 years: Sitharaman
February 1, 2026 12:35 pm
FM proposes duty free imports of certain specified inputs for promoting export of leather. Customs duty exemptions removed on coffee roasting/brewing/vending machines, CD-ROMs containing books or newspaper from February 2, says Sitharaman.
Budget proposes to exclude entire value of biogas while calculating excise duty payable on blended CNG: FM Sitharaman
February 1, 2026 12:34 pm
Proposes to extend time period of exports of final products from 6-month to 1-year for exporters of leather, textile garments.
Govt will create five tourism destinations in 5 Purvodaya states and will make provisions for 4,000 e-buses: FM
February 1, 2026 12:34 pm
Sitharaman says government will develop 15 archaeological sites, including Lothal, Dholavira, Rakhigarhi, Sarnath and Hastinapur.
Govt will develop an integrated East Coast Industrial Corridor with well-connected node at Durgapur: FM
February 1, 2026 12:33 pm
FM extends exemption on capital goods used for manufacturing lithium ion cells for battery storage.
Budget proposes to raise Securities Transaction Tax to 0.05 pc on commodity futures from 0.02 pc: FM Sitharaman
February 1, 2026 12:33 pm
Proposes to remove exemptions on customs duties on items manufactured in India or have negligible import.
MAT to be made final tax; rate reduced to 14 pc, from current 15 pc: Sitharaman
February 1, 2026 12:33 pm
Tariff rate on certain items is being modified with effect from February 2 and certain others from April 1 as part of rate rationalisation, says FM.
Govt to tax buyback proceeds for all types of shareholders as capital gains: FM Sitharaman
February 1, 2026 12:32 pm
Tax Collected at Source rate on liquor, scrap and mineral rationalised to 2 per cent, says Sitharaman.
Budget proposes new tariff lines to help in better identification of coated pipes for exports: FM Sitharaman
February 1, 2026 12:32 pm
No customs duty on goods used to manufacture battery energy storage system
February 1, 2026 12:29 pm
To extend basic customs duty exemption for capital goods used to manufacture Battery Energy Storage System (BESS).
Govt proposes joint panel of Corporate Affairs Ministry and CBDT for incorporation of income computation and disclosure standards
February 1, 2026 12:27 pm
Budget proposes to rationalise definition of accountants for safe harbour rules to promote home-grown accounting firms: Sitharaman
February 1, 2026 12:24 pm
FM says National Destination Digital Knowledge Grid will be established to digitally document all places of significance.
FM proposes to exempt Minimum Alternate Tax for non-residents who pay tax on presumptive basis
February 1, 2026 12:24 pm
Govt allows inter-cooperative societies dividend income as deduction under new tax regime: FM Sitharaman
February 1, 2026 12:22 pm
Threshold for availing safe harbour for IT services is being enhanced from Rs 300 crore to Rs 2,000 crore: FM
February 1, 2026 12:22 pm
Govt will set up National Institute of Hospitality by upgrading existing National Council for Hotel Management and catering Technology: FM
February 1, 2026 12:22 pm
Budget proposes tax holiday till 2047 to foreign companies that provide cloud services to customers globally by using data centres in India
February 1, 2026 12:21 pm
Finance Minister Nirmala Sitharaman proposed tax holiday till 2047 for foreign companies that provide cloud services to customers worldwide by using data centres in the country. The tax holiday will be extended to the entities concerned subject to certain conditions. In the Union Budget 2026-27 speech, Sitharaman said there is a need to enable critical infrastructure and boost investment in data centres.
Govt extends deduction for cooperative members who supply cotton seeds and cattle feed
February 1, 2026 12:20 pm
In Odisha, Karnataka, and Kerala, key turtle nesting sites along with turtle trails will be developed: FM Sitharaman
February 1, 2026 12:19 pm
FM says NIMHANS-2 (National Institute of Mental Health and Neurosciences) will be set up
February 1, 2026 12:19 pm
States to get 41% share in fund transfers, Rs14 lakh crore allocated, says FM
February 1, 2026 12:18 pm
FM announced that it will maintain a 41% share for states in the transfer of funds, following the recommendations of the 16th Finance Commission; for the financial year 2026-27, the Central Government has allocated Rs 14 lakh crore to the states, ensuring resources for development and welfare initiatives across the country.
50 per cent capacity will be increased in district hospitals by establishing emergency and trauma care centres: FM Sitharaman
February 1, 2026 12:17 pm
FM proposes exemptions of 3 years for dividend income received by notified cooperatives on investments made up to January 31, 2026
February 1, 2026 12:16 pm
No interest liability on taxpayer on penalty amount for period of appeal before 1st appellate authority, irrespective of outcome: FM
February 1, 2026 12:16 pm
FM proposes a six-month foreign asset disclosure scheme for small taxpayers like students, tech professionals and relocated NRIs
February 1, 2026 12:15 pm
Tax Collected at Source (TCS) rate on sale of overseas tour packages cut to 2 pc from 5 pc and 20 pc earlier: FM
February 1, 2026 12:15 pm
Proposes reduction in TCS rate for pursuing education and medical education under liberalised remittance scheme from 5 per cent to 2 per cent.
FM announces simplified tax rules for NRIs
February 1, 2026 12:15 pm
Extended time to revise returns with payment of a nominal fee; individuals filing ITR-1 and ITR-2 can continue to file till July 31; non-audit business cases and trusts will be allowed to file returns till August 31; TDS on sale of immovable property by NRIs will now be deducted by the resident buyer, replacing the earlier requirement of quoting a TAN.
Time limit for filing revised I-T returns extended to March 31
February 1, 2026 12:13 pm
FM proposed extending the time limit for filing revised income-tax returns from December 31 to March 31, with the provision to do so on payment of a nominal fee.
Targeted effort to increase farmer income
February 1, 2026 12:12 pm
To provide special attention to small farmers; to empower the vulnerable to access mental health and trauma care; to undertake initiatives to develop 500 reservoirs; to strengthen the fisheries value chain in coastal areas; to support animal husbandry through a credit-linked subsidy programme; to encourage the creation of livestock farmer producer organisations; to support high-value crops such as coconut, sandalwood, and cashew in coastal areas; to support the generation of walnuts in hilly regions; to enhance competitiveness in coconut production and to launch a dedicated programme proposed for the Indian cashew and cocoa.
Govt removes customs duty exemption on naphtha for use in fertilisers and metal parts used in manufacture of electrical insulators
February 1, 2026 12:11 pm
Govt proposes to exempt award given by Motor Accident Claims Tribunal from income tax, says FM
February 1, 2026 12:07 pm
FM Proposes rule-based automated process for small taxpayers in FY27 Budget: Sitharaman
February 1, 2026 12:07 pm
Net tax receipts estimated at Rs 28.7 lakh crore, Budget size at Rs 53.5 lakh crore. Sitharaman
February 1, 2026 12:04 pm
Income Tax Act, 2025, to be implemented from April 1; rules and tax returns forms to be notified shortly: Sitharaman
February 1, 2026 12:04 pm
Finance Minister Nirmala Sitharaman said the Income Tax Act, 2025 will be implemented from April 1 and rules and tax returns forms will be notified shortly. Beginning April 1, the Income Tax Act, 2025, will come into force replacing the six-decade-old tax law and the changes made in tax laws in 2026-27 Budget will be incorporated in the new legislation.
Govt to borrow Rs 11.7 lakh crore in FY27 from dated securities to fund its fiscal deficit
February 1, 2026 12:04 pm
Govt provides Rs 1.4 lakh crore as tax devolution to states in FY27: FM
February 1, 2026 12:04 pm
Fiscal deficit pegged at 4.3 pc of GDP in FY’27, lower than 4.4 pc in FY’26: Sitharaman
Govt to launch scheme for development of Buddhist circuit in North East region to preserve temple, monastries: FM Sitharaman
February 1, 2026 12:03 pm
Govt proposes to lower debt-to-GDP ratio to 55.6 pc per cent in FY27, from 56.1 pc in current fiscal: Sitharaman
February 1, 2026 12:02 pm
FM allocates Rs 5,000 crore for CITY Economic Regions (CERs) over 5 years
February 1, 2026 12:02 pm
Govt has accepted the recommendations of 16th Finance Commission, retaining 41 pc tax devolution formula: Sitharaman
February 1, 2026 12:02 pm
FM proposes to support Artificial Limbs Manufacturing Corporation of India to scale up production of assisted devises for divyangjan
February 1, 2026 12:01 pm
FM proposes to launch Bharat Vistar, a multilingual AI tool to integrate agri stack
February 1, 2026 12:00 pm
FM proposes setting up of ‘She Marts’ as community-owned retail outlets
February 1, 2026 11:59 am
Govt proposes credit link subsidy programme, encourage livestock farmer producer organisations to promote employment opportunities: FM
February 1, 2026 11:59 am
Govt will create a network of over 1,000 accredited Indian Clinical Trial sites: FM
February 1, 2026 11:58 am
Govt proposes coconut promotion scheme to increase production, productivity
February 1, 2026 11:58 am
We will develop ecologically sustainable trails in Himachal Pradesh, Utttarakhand and Jammu and Kashmir: Sitharaman
February 1, 2026 11:55 am
Telescope infrastructure to be upgraded to promote astrophysics and astronomy: FM
February 1, 2026 11:55 am
Govt to launch pilot scheme to upgrade skills of 10,000 guides at 20 iconic tourist sites: FM Sitharaman
February 1, 2026 11:55 am
Centre to support 5 university townships in vicinity of major industrial logistics centres: Sitharaman
February 1, 2026 11:53 am
Budget proposes to support of Indian Institute of Creative Technologies Mumbai for setting up content labs in 15,000 secondary schools
February 1, 2026 11:53 am
Budget proposes Biopharma SHAKTI with an outlay of Rs 10,000 crore over next 5 years: FM Sitharaman
February 1, 2026 11:52 am
Government to set up one girls’ hostel in every district of country: FM Sitharaman
February 1, 2026 11:51 am
Budget proposes to upgrade WHO Global Traditional Medicine Centre at Jamnagar, Gujarat
February 1, 2026 11:47 am
FM proposes loan-linked capital subsidy support scheme for veterinary collages, hospitals, diagnostics laboratories
February 1, 2026 11:47 am
Centre to support 5 university townships in vicinity of major industrial logistics centres: Sitharaman
February 1, 2026 11:47 am
Govt proposes scheme to strengthen domestic manufacturing of high-value, technology-advanced capital goods and infrastructure equipment
February 1, 2026 11:46 am
Govt to support states in setting up five hubs for medical tourism: Sitharaman
February 1, 2026 11:46 am
Government will continue to focus on developing infrastructure in cities with over 5 lakh population, says the FM
Person of Indian Origin (PRIO) permitted to invest in equity instruments, listed indian companies through Portfolio Investment Scheme: FM
February 1, 2026 11:45 am
The individual limit is set to be increased from 5% to 10%, while the combined cap for all such investors is proposed to rise from 10% to 24%. This change would allow serious foreign individual investors to take more meaningful stakes in Indian companies, potentially improving price discovery, deepening shareholding, and supporting long-term capital formation.
In FY27, capital expenditure set at Rs 12.2 lakh crore
February 1, 2026 11:44 am
For the Financial Year 2027, the capital expenditure has been set at Rs 12.2 lakh crore.
Public capital expenditure gets Rs 11 lakh crore
February 1, 2026 11:43 am
Public capital expenditure has increased manifold to an allocation of 11 lakh crore in the Budget Estimates.
Rs 10,000 Crore SME Growth Fund
February 1, 2026 11:42 am
FM proposed to introduce Rs 10,000 crore SME growth fund. The idea is to incentivise SMEs based on select criteria.
Existing institutions for allied health professionals to be upgraded: Sitharaman
February 1, 2026 11:40 am
FM proposes 7 high-speed rail corridors across India
February 1, 2026 11:38 am
FM proposed the development of 7 high-speed rail corridors as part of efforts to boost connectivity and infrastructure in India. Key routes include: Mumbai to Pune; Pune to Hyderabad; Hyderabad to Bengaluru; Bengaluru to Chennai. Additional corridors are planned to further strengthen regional connectivity and economic growth across the country under the Union Budget 2026-27.
Close to 25 crore people have come out of multi-dimensional poverty: FM Sitharaman
February 1, 2026 11:35 am
FM proposes to market making framework with suitable access to funds and derivatives on corporate bond indices
February 1, 2026 11:35 am
FM proposes incentive of Rs 100 crore for single bond issuance by municipal corporation of more than Rs 1,000 crore
February 1, 2026 11:35 am
Finance Minister proposes to restructure REC, PFC as part of public sector financial institution strengthening
Finance Minister Nirmala Sitharaman on Sunday arrived at Parliament to attend the Cabinet meeting before presenting her record ninth Budget at the Central Hall of Parliament. The Union Cabinet, headed by Prime Minister Narendra Modi, will approve the Union Budget 2026-27 in Parliament. She will present the Union Budget in the Lok Sabha at 11 am.
President Murmu offers ‘dahi cheeni’ to FM Sitharaman
Sitharaman meets President for customary pre-Budget presentation meeting
February 1, 2026 10:21 am
Finance Minister Nirmala Sitharaman on Sunday called on President Droupadi Murmu before presenting her record ninth Budget in the Lok Sabha. As per established tradition, the Finance Minister met the President at the Rashtrapati Bhavan before heading to Parliament. Before going to the Rashtrapati Bhavan, Sitharaman posed with her Budget team in front of her office at Kartavya Bhavan. Wearing a magenta silk saree, she was holding a tablet in a red pouch with the national emblem, along with the Minister of State and all six Secretaries in her ministry.
Finance Minister to present her ninth straight Budget
February 1, 2026 9:50 am
Finance Minister Nirmala Sitharaman will present her ninth straight Budget, which is expected to unveil measures to sustain growth momentum, maintain fiscal discipline, and announce reforms that could buffer the economy from global trade frictions, including US tariffs. PTI
44 per cent hike in budget for CAPF building projects, but outlay for modernisation plummets
A 44 per cent hike has been made in the allocations for building projects for the Central Armed Police Forces (CAPFs) and Central Police Organisations in the union budget for the 2026-27 fiscal that was presented on Sunday.
On the other hand, the budgetary provisions for the development and maintenance of border infrastructure have seen only a marginal hike of about three percent, whereas allocations for the modernisation of CAFPs have dipped sharply by over 40 percent.
The Finance Minister, Nirmala Sitharaman, has proposed Rs 5,393.37 crore for CAPF building projects in 2026-27 compared to the revised estimates of Rs 3684.23 crore for the 2025-26 fiscal. The actual expenditure for 2024-25 was Rs 2133.18 crore, according to data contained in the budget documents.
The building projects for the CAPFs, which include the National Security Guard, Assam Rifles, Border Security Force, Indo-Tibetan Border Police, Shashtra Seema Bal, Central reserve Police Force and the Central Industrial Security Force, focus on constructing office accommodation, residential units, barracks, hospitals and allied facilities for providing better service conditions and amenities to their personnel and families.
The Ministry of Home Affairs has granted the status of Public Works Organisation (PWO) to the engineering wings of the CAPFs so that they can undertake and expedite their own infrastructure construction requirements.
Earlier, they had to utilise the services of central and state Public Works Departments, which were already over-burdened with work and also led to procedural delays. Financial limits have been laid for construction projects and repair works that CAPFs can execute under delegated powers to be exercised by stipulated technical officers.
The construction requirements of the CAPFs are diverse and widespread, mostly in remote areas. These forces have a significant presence in high altitude and inhospitable terrain, where construction of infrastructure is difficult. As far as border infrastructure and management is concerned, the proposed allocation for 2026-27 is Rs 5576.51 crore.
This includes a capital outlay of Rs 5,266.51 crore and a revenue expenditure of Rs 310 crore for maintenance and border check posts. The total revised estimates in 2026-27 were Rs 5,472.31 crore, whereas the actual expenditure for 2024-25 was Rs 3,953.84 crore.
The allocation for modernisation for CAPFs under Plan-IV has dropped from the revised estimates of Rs 610.79 crore in 2025-26 to Rs 343.66 crore for 2025-26. The plan, when conceived, covered the period from February 2022 to March 2026 for upgrading their operational capabilities and making them more tech-savvy.
THE most interesting data points from the Union Budget 2026-27, hidden in plain sight, are the income tax (I-T) collection numbers. Last year, the government expected to collect about Rs 14.4 lakh crore in ‘taxes on income’. Some, including me, had argued back then that this was an overly optimistic projection, given that the Finance Minister had raised the I-T thresholds and the number of I-T payers would fall sharply because of that. The counterargument given by others was that India’s economy was on the verge of a revival, and that would lead to big salary hikes, and push more people across the income tax threshold.
As it turns out, we were right. The revised estimate for I-T collections for 2025-26 is now just Rs 13.1 lakh crore. That’s about 9 per cent less than what the Budget had estimated. More importantly, I-T collections grew by just 6.2 per cent in this fiscal year, compared to 2024-25. Compare that to the 18.2 per cent and 25.4 per cent growth seen in the previous two financial years. This is especially significant when we compare it to nominal GDP growth. In 2025-26, I-T collections underperformed nominal GDP by 1.8 percentage points. In 2024-25, I-T collections outperformed nominal GDP growth by 8.4 percentage points, and in 2023-24, the growth in I-T collections was a whopping 13.3 percentage points higher than nominal GDP growth.
You don’t need a clearer piece of evidence to show that India’s upper middle class is in deep trouble. Let me break this down a little more. I am going to assume that those with a pre-tax monthly income between Rs 1.5 lakh and Rs 3.5 lakh are ‘upper middle class’. The bulk of these people would be middle managers in the corporate sector, while some would be self-employed professionals. They account for roughly 9 per cent of those who file income tax returns and contribute about 35 per cent of the total I-T collections.
Above them come the affluent, the rich and the super rich. These include senior managers, especially those in the C-suite, top-level lawyers, doctors and other professionals, startup founders and big entrepreneurs. They make up just 1.5 per cent of those who file tax returns, but account for over 50 per cent of the income tax collected by the Centre.
Now, all jobs and recruitment surveys and reports tell us that 2025 has been a great year for top honchos in India Inc, and also for people running startups. This means they must have paid much higher income tax than they did last year. Despite this, if the total income tax collections have increased by just 6.2 per cent, it can only mean that the ‘upper middle class’ taxpayers have paid less tax than in 2024-25. This only adds to what we know anecdotally, that thousands of middle managers in India have lost their jobs, or taken pay cuts to survive.
That we are in the middle of a massive consumption downcycle is also evident from the sluggish growth in GST collections. One reason, of course, is that GST rates have been slashed sharply in the middle of 2025-26. But even if we take just the April-September period and compare it to the previous year, the growth in GST collections was less than 6 per cent. This again, is well below the average 8.8 per cent nominal GDP growth in the first two quarters of 2025-26. So, the tax data confirms what some of us have been saying — India’s upper middle class is not only earning less, it is also spending less than ever before.
On the other side, the same tax data proves that India’s corporate sector is doing extremely well. ‘Corporation tax’ collections beat the budgetary estimates — the government expected to collect Rs 10.8 lakh crore in 2025-26, but is likely to get Rs 11.1 lakh crore instead. That means corporate tax collections increased by 12.3 per cent compared to 2024-25, which is more than 1.5 times the growth in nominal GDP. In other words, corporates are getting a larger share of our national income, while the upper middle class is getting a smaller chunk.
Despite this, the government expects income tax payers to continue to contribute more to the exchequer than the corporate sector. Corporate taxes are projected to account for 28 per cent of the next financial year’s tax revenues, while income tax is estimated to be a little more than 33 per cent. This can only happen if there’s a massive revival in white-collar jobs and salaries in 2026-27. All evidence points to the contrary — AI is likely to cause even more middle manager layoffs this year than 2025.
In fact, if the government expects income tax revenues to rise, it should also expect a revival of middle-class consumption. If that were the case, GST collections should also rise, because the increased volumes would offset the reduction in GST rates. Yet, the budgetary estimate for the next financial year is that GST collections will actually fall by 3 per cent in 2026-27 compared to this fiscal. So, the government’s own indirect tax estimates seem to contradict its income tax projections.
The Budget happens to be a political document. Every incumbent government uses it as a fiscal tool to win elections. The Modi government is no different. Its expenditure is directed towards those who make up the electoral numbers and those who can finance electoral campaigns. Therefore, the poor are going to continue to get subsidised food, some amount of guaranteed work, and financial aid to build homes.
On the other side, India Inc will continue to get tax subsidies and lucrative infrastructure projects — including the new tax sops for building data centres. Government contracts will keep India’s corporate sector insulated from the decline in consumption demand that will be caused by a fall in upper-middle-class incomes.
Meanwhile, the middle class will stay locked up in gated housing complexes and WhatsApp groups. No wonder governments don’t take it seriously.
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