The Union Budget 2026–27 places international trade and exports at the core of India’s growth strategy, reaffirming the Government’s resolve to build a competitive, resilient, and globally integrated economy. Anchored in macroeconomic stability, fiscal discipline, and sustained public investment, the Budget outlines a comprehensive reform agenda aimed at boosting jobs, strengthening manufacturing, and positioning India as a trusted global trading partner on the path to Viksit Bharat.
Exports as a Driver of Jobs and Industrial Upgradation
Recognising exports as a key engine of employment generation, industrial upgrading, foreign exchange earnings, and global value chain (GVC) integration, the Budget announces wide-ranging measures spanning manufacturing, services, infrastructure, Special Economic Zones (SEZs), logistics, and ease of doing business. The overarching objective is to lower trade costs, enhance scale and competitiveness, and deepen India’s integration with global markets.
Scaling Manufacturing Across Strategic and Labour-Intensive Sectors
A major highlight of the Budget is its sharp focus on scaling domestic manufacturing in both strategic and labour-intensive sectors. Flagship initiatives include:
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Biopharma SHAKTI for strengthening pharmaceutical and biotechnological capabilities
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India Semiconductor Mission 2.0 to deepen semiconductor manufacturing and design
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Expansion of the Electronics Components Manufacturing Scheme
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Development of Rare Earth Corridors and Chemical Parks
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Targeted support for capital goods and container manufacturing
These measures aim to reduce critical import dependence while enhancing India’s export competitiveness in high-value segments.
Renewed Push for Labour-Intensive Exports
Labour-intensive sectors such as textiles, footwear, sports goods, handicrafts, and handlooms receive renewed attention through integrated manufacturing parks, cluster-based development, skilling initiatives, and sustainability-focused programmes. The proposed revival of 200 legacy industrial clusters through infrastructure and technology upgradation is expected to lower costs, improve productivity, and strengthen traditional export hubs.
Trade Facilitation Boost for Gems, Jewellery and E-Commerce Exports
The gems and jewellery sector, one of India’s largest foreign exchange earners, stands to benefit from indirect but impactful reforms. Removal of the ₹10 lakh value cap on courier exports will support small exporters and e-commerce-driven B2C shipments. Improvements in handling returned consignments and extensions of concessional customs duty regimes for gold and silver dore bars and lab-grown diamond inputs will further encourage domestic value addition.
Services Exports: Targeting Global Leadership
The services sector receives a strong policy thrust with the proposal to set up a High-Powered Education-to-Empowerment and Enterprise Standing Committee to guide coordinated reforms. The Budget sets an aspirational target of achieving a 10% share in global services exports by 2047.
Targeted tax and regulatory reforms for IT and IT-enabled services—including unified service classification, higher safe-harbour thresholds, automated approvals, faster Advance Pricing Agreements, and long-term tax certainty—are expected to enhance India’s appeal for Global Capability Centres (GCCs).
Cloud, Data Centres and Digital Trade
To position India as a global digital hub, 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 attract foreign investment, deepen digital infrastructure, and strengthen India’s role in data-driven global trade.
SEZ Reforms to Enhance Scale and Global Investor Interest
Reforms in Special Economic Zones (SEZs) aim to improve capacity utilisation, economies of scale, and resilience while preserving export orientation. One-time facilitation for limited Domestic Tariff Area (DTA) sales at concessional duties, along with extended incentives for cloud and data-centre operations, is expected to attract global manufacturers and technology players.
Infrastructure and Logistics: Cutting Export Costs
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—especially for exporters in tier-2 and tier-3 cities.
Technology-Driven Ease of Doing Business in Trade
The Budget advances a trust-based, technology-driven trade facilitation framework, including:
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Electronic sealing of export cargo
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Trusted supply-chain recognition
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Automated customs processes and non-intrusive scanning
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Longer validity of advance rulings
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Enhanced duty deferment for Authorised Economic Operators (AEOs)
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Removal of value caps for courier exports
Together, these reforms aim to improve predictability, reduce transaction costs, and enhance India’s standing in global trade facilitation indices.
₹10,000 Crore SME Growth Fund for MSME Exports
Acknowledging MSMEs as the backbone of India’s export ecosystem, the Budget announces a ₹10,000 crore SME Growth Fund, strengthened credit guarantee mechanisms, mandatory use of TReDS by CPSEs, and integration of GeM with TReDS. These measures directly address working-capital constraints and enable MSMEs to scale up in global markets.
Sector-Specific Export Opportunities
Additional export momentum is expected from sector-specific initiatives in agriculture, marine products, pharmaceuticals, tourism, AVGC (Animation, Visual Effects, Gaming and Comics), and allied health services, reinforcing India’s diversified export base.
Conclusion: Union Budget
Overall, the Union Budget 2026–27 presents a coherent, forward-looking export and trade strategy—combining competitive manufacturing, services excellence, logistics modernisation, regulatory simplification, and infrastructure investment. By strengthening India’s integration with global value chains and empowering MSMEs, the Budget lays a strong foundation for sustained export growth, job creation, and long-term economic resilience, firmly positioning India as a reliable global partner.
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Source: PIB
