Budget 2026: Sitharaman's Tightrope Walk - Balancing Public Relief & Fiscal Health Amid US Tariffs

• Finance Minister Nirmala Sitharaman faces the challenge of balancing public relief and controlling the government's deficit in Budget 2026.
• US President Donald Trump's proposed 500% tariff on India threatens Indian exports, especially MSMEs, impacting the economy.
• Government may announce new incentive schemes for exporters and focus on market diversification to counter US tariff effects.
• Measures to boost domestic demand, like tax relief or GST reforms, could increase consumption but also impact government revenue.
• The fiscal deficit, which was 9.5% during Covid, is targeted to reach 4% in the next financial year, posing a challenge if relief measures are expanded.

Why It Matters: Nirmala Sitharaman must balance public relief with fiscal deficit control amidst US tariff threats and economic challenges.