Budget 2025 vs 2026: Which Sectors Are Seeing Higher Government Spending?

Synopsis: Union Budget 2026 raised total outlay to ₹53.47 lakh crore from ₹50.65 lakh crore, boosting allocations across key sectors, while markets reacted cautiously with Nifty and Sensex slipping nearly 3% intraday amid mixed investor sentiment.

The Union Budget 2026, presented on 1 February 2026 by Finance Minister Nirmala Sitharaman, reinforced the government’s commitment to growth-oriented reforms and long-term economic resilience. The policy thrust remained centred on strengthening manufacturing, export competitiveness, and structural reforms, reflecting an intent to sustain India’s growth momentum amid persistent global uncertainties. While the budget stayed aligned with reform-linked initiatives and production-focused sectors, market participants initially reacted with caution, weighing the fiscal strategy against near-term economic challenges.

In terms of overall fiscal size, the government continued to scale up spending. The total Union Budget outlay increased from Rs. 50,65,345.04 crore in FY26 to Rs. 53,47,314.81 crore in FY26-27, reflecting a clear step-up in expenditure to support economic growth. The higher allocation underscores the government’s intent to maintain momentum in public spending, particularly to crowd in private investment and strengthen domestic demand across key sectors.

On the market front, benchmark indices Sensex and Nifty witnessed volatile trade post-Budget, reflecting mixed investor sentiment. The Nifty opened at 25,333.75 and declined to an intraday low of 24,571.75, marking a fall of about 3 percent from its opening level and closed at 24,825.45. While the Sensex opened at 82,388.97 and slipped to an intraday low of 79,899.42, also marking a near 3percent  decline from the open and closed at 80,722.94. Below is the list of Sector in which government has increased Budget Allocation –

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