Budget 2026: Not a Game-Changer, but Expected to Attract Foreign Capital

• Varun Lohchab of HDFC Securities anticipates Budget 2026 will not be a game-changer, focusing on growth and fiscal discipline.
• The budget is expected to include measures to attract foreign capital, driven by projected GDP growth recovery in FY27.
• Continued focus on manufacturing, CAPEX, and sectors like railways, renewable power, infrastructure, and defense manufacturing is expected.
• FIIs will monitor tax stability, regulatory predictability, CAPEX focus, and fiscal discipline for investment decisions.
• RBI is unlikely to cut rates in February despite low inflation, focusing instead on liquidity measures and transmission of past cuts.

Why It Matters: Budget 2026 will prioritize growth and fiscal discipline, aiming to attract foreign investment without major reforms.