CHENNAI ■ MADURAI ■ VIJAYAWADA BENGALURU ■ KOCHI ■ HYDERABAD ■ VISAKHAPATNAM ■ COIMBATORE ■ KOZHIKODE ■ THIRUVANANTHAPURAM ■ BELAGAVI ■ BHUBANESWAR ■ SHIVAMOgGA ■ MANGALURU ■ TIRUPATI ■ TIRUCHY ■ TIRUNELVELI ■ SAMBALPUR ■ HUBBALLI ■ DHARMAPURI ■ KOTTAYAM ■ KANNUR ■ VILLUPURAM ■ KOLLAM ■ TADEPALLIGUDEM ■ NAGAPATTINAM ■ THRISSUR ■ KALABURAGI ■ ■ kottayam l monday l February 02, 2026 l `9.00 l PAGES 14 l city EDITION Infrastructure environment Agriculture MSMEs Healthcare Manufacturing education 7 high-speed rail corridors Backing clean energy High-value crops L10K cr MSME growth fund Medical tourism L40K-cr for semiconductors Future readiness Mumbai-Pune, HydB’luru, Pune-Hyd, Chennai-B’luru, HydChennai, B’luruVaranasi, Varanasi-Siliguri Customs relief for lithium-ion battery inputs, solar and nuclear exemptions, carbon capture funding Emphasis on coconut, cashew, cocoa, sandalwood, sets aside I350cr for this push, aimed at raising farm incomes Big push to small businesses via capital support, faster payments, enhanced credit guarantees Destination mapping to boost medical tourism, district trauma care and allied health professional training Focus on renewable technology, battery supply chains and local value addition in advanced goods University townships near industrial zones, creative tech labs in schools, committees tying education to jobs 20-yr tax holiday for foreign firms using Indian data centres boost for tech and sunrise sectors no change in tax slabs big on small , Small on big D i pa k M o nd a l Budget will empower the poor, farmers, youth, and women. It will boost ‘Make in India’ Narendra Modi, PM A Budget that’s blind to India’s real crises. Household savings down. Farmers in distress. global shocks —all ignored Rahul Gandhi, Cong Budget is progressive. Centre has taken steps to accelerate pace of the development. It will turn Viksit Bharat vision into reality Nitish Kumar, Bihar CM Government has run out of ideas. Budget doesn’t provide solution to political and socio-economic challenges Mallikarjun Kharge, Congress president UNION Budget 2026-27, presented by Finance Minister Nirmala Sitharaman in Parliament on Sunday, turned out to be a story of unrealised expectations rather than bold reforms. There were no big-bang announcements or path-breaking policy pushes. Instead, the government appeared keen not to disturb the current ‘Goldilocks phase’ of moderate growth and low inflation. Expectations were not particularly high, given that the Budget followed two major tax overhauls — Direct Tax Code and GST rate rationalisation — yet, there was hope for a fresh reform impulse. In the end, the finance minister held back more than she unveiled. There were numerous small measures in the Budget, but none large enough to excite the markets. Instead, a few unexpected moves unsettled the equity market which was already under pressure from persistent foreign institutional investment (FII) outflows. Contrary to expectations of a reduction in securities transaction tax (STT), the government proposed higher levies on the futures and options (F&O) segment to curb speculative trading, which led to significant investor losses. The move did not go down well with the markets, which fell over 2% after the announcement. As anticipated, there were no changes in individual tax slabs following last year’s increase in the minimum tax threshold to `12 lakh. At the same time, the Budget rolled back the controversial buyback tax rule under which buyback proceeds were treated as deemed dividend income without allowing deduction of acquisition cost. These proceeds will now be taxed as capital gains for all shareholders. Other relief measures included a limited overseas tax amnesty scheme for small taxpayers and a reduction in tax collected at source (TCS) on overseas spending. Sitharaman’s `53 lakh crore Budget adopted a cautious rather than ambitious approach. It adhered to Record capex allocation at L12.2 lakh cr for FY27 With a sustained focus on public expenditure, Finance Minister Nirmala Sitharaman raised the capex target to I12.2 lakh crore for FY27 from the revised estimate of I10.95 lakh crore in FY26. Public capex has increased manifold from I2 lakh crore in FY15 to the record levels now the fiscal glide path by pegging the fiscal deficit at 4.3%, just 10 basis points lower than the current year’s 4.4% target. The FM also formally announced a shift in fiscal management focus from fiscal deficit to a debt-to-GDP ratio target of 50±1% by 2030–31. “In line with this, the debt-to-GDP ratio is estimated at 55.6% of GDP in BE 2026–27, compared to 56.1% in 2025–26. A declining debt-to-GDP ratio will gradually free up resources for priority sector expenditure by reducing interest outgo,” she said. The minister told the media that the government has consistently delivered on its fiscal commitments without compromising on social sector needs. The modest fiscal targeting comes amid muted revenue growth, with the government missing its FY26 tax collection target of `42.7 lakh crore by nearly `2 lakh crore. Despite revenue constraints, the FM increased capital expenditure from `11.2 lakh crore to `12.2 lakh crore after two years of relatively subdued growth. “We have announced `12.2 lakh crore in public expenditure this time. It is 4.4% of GDP, the highest in at least the last 10 years. Such sustained increases in capital expenditure have not happened before,” she said. The government also accepted the 16th Finance Commission’s recommendation to retain the vertical devolution share to states at 41%. To support exporters amid global trade uncertainties, the Budget introduced a series of customs duty changes aimed at lowering input costs for manufacturing and exports, while tightening tax rules in selected areas. Technology and sunrise sectors received incentives, while the Budget announced a tax holiday until 2047 for foreign companies providing services to customers outside India using data centres located in India. In addition, the government proposed a safe harbour margin of 15% on costs where the data centre service provider in India is a related entity. The Budget also had a provision for exempting income tax for 5 years to non-residents providing capital goods, equipment or tooling, to any toll manufacturer in a bonded zone. The government announced a series of tax measures aimed at boosting electronics manufacturing, attracting global investment, and drawing skilled foreign talent to India. A r s h a d K h a n @ New Delhi INSIDE F&O STT hike a conscious decision: Nirmala I P5 Relief as govt U-turn for buyback tax I P8 Mamata Banerjee, West Bengal CM Fresh focus on AI, jobs; tax relief for IT services I P9 Mental health, affordable cancer care top focus I P10 Over L95K cr allocation for G RAM G scheme I P10 E x p r e s s N e w s Se r v i c e @T’Puram Illustration: Sourav Roy How it fared Contrary to expectations of a cut in securities transaction tax (STT), the government proposed higher levies on the futures and options (F&O) segment to curb speculative trading, which has led to significant investor losses J12 lakh No change in individual tax slabs following last year’s increase in the minimum tax threshold to I12 lakh Surprises Controversial buyback tax rule rolled back. Under that rule, buyback proceeds were treated as deemed dividend income without allowing deduction of acquisition cost Govt accepts 16th Finance Commission’s recommendation to retain the vertical devolution share to states at 41% 41% Seven manufacturing sectors including bio-pharma and semiconductors get a push to ensure long-term stability and security Tax holiday until 2047 for foreign companies that provide services to customers outside India using data centres in India Shifting focus to longignored sectors like mining, textiles, engineering goods, chemicals, and renewables We have announced L12.2 lakh crore in public expenditure this time. It is 4.4% of GDP, the highest in at least the last 10 years. Such sustained increases in capital expenditure have not happened before — Nirmala Sitharaman hike in securities transaction tax sends markets into tailspin No handouts for poll-bound states I P7 Budget is directionless, visionless, actionless and anti-people. It is also anti-women, antifarmer, anti-education. Tax share up, but Budget leaves Kerala disappointed Show time Finance Minister Nirmala Sitharaman on the Parliament premises before the presentation of the Union Budget | Shekhar yadav India’s equity market crashed by a whopping 2.88% intraday on Sunday as the government’s proposal to raise the securities transaction tax (STT) on derivatives trading triggered widespread sell-off. The Sensex plummeted 2,370 points, diving below the 80,000 to hit an intraday low 79,899. Similarly the NSE Nifty tanked , 749 points, or 2.95%, to 24,572. They pared some losses and at close, the Sensex was down 1,547 points (1.88%) at 80,723 while Nifty50 settled at 24,825.45, down 495 points (1.95%). This marks the sharpest Budget day drop in years, barring the 2.5% Covid-induced crash in 2020. In the Nifty50 pack, more than a dozen stocks fell over 4% each with Adani Ports, BEL, Hindalco, SBI, ONGC, Jio Finance and Coal Sensex dives 82,500 82,000 Previous close 81,500 82,269.78 Today’s closing 81,000 80,500 80,722.94 79,899.42 India taking the biggest hits. Finance Minister Nirmala Sitharaman proposed to raise STT on futures to 0.05% from 0.02%. STT on options premium and exercise of options will also be raised to 0.15% from the present rate of 0.1% and 0.125%, respectively . She later explained that the STT hike in F&O was to deter small investors who ended up losing money in speculative derivative trades. However, market experts warned that the increase in STT could dampen high-frequency trading and foreign inflows as it increases upfront trading costs. A Rise in tax share that would see it receiving around `9,500 crore more from the previous fiscal was all Kerala had to cheer about in the Union Budget. Both the ruling LDF and Opposition UDF slammed the Budget for the ‘total neglect’ towards the state. Kerala will get a higher share from the divisible pool of union taxes and duties for five years starting 2026-27. This follows the 16th Finance Commission’s recommendation to raise the state’s share from 1.925% to 2.382%. Accordingly, `36,355 crore has been earmarked for Kerala in the budget, up from `26,814 crore last year. A ‘Rare Earth Corridor’ and ‘Turtle Trail’ are the projects announced for the state. However, none of the major proposals presented by Kerala Finance Minister K N Balagopal at the prebudget consultation were considered. While the state sought `1,000 crore for the ‘Rare Earth Corridor’ project it announced in its budget on January 29, the one in the Union Budget is a central scheme. Chief Minister Pinarayi Vijayan said the Centre’s ‘Rare Earth Corridor’ aims to appropriate Kerala’s mineral wealth and facilitate private monopoly in mining. He alleged that the budget revealed the Centre’s ‘intense discrimination and neglect’ towards Kerala. “Our demands for AIIMS, high speed railway corridors and Vizhinjam port package were ignored. Retaining vertical devolution share at 41% weakens principles of federalism,” he said. Leader of Opposition V D Satheesan wondered whether Kerala was part of India. “PM Narendra Modi and BJP leaders made claims about Vikasitha Kerala. Will this Budget help in state’s development? This is a warning. It reveals BJP’s neglect towards Kerala,” he alleged. Defending the Budget, BJP state president Rajeev Chandrasekhar said it was futile to announce projects for Kerala. “The state did not implement projects sanctioned by the Centre. It did not acquire land for AIIMS. Though the Centre sanctioned money for PM Awas Yojana, the state did not utilise it,” he alleged. P4 T20 World Cup takes another political twist, Pak govt disallows team to play India e x p r e s s ne w s s e r v i c e @ Chennai THE Pakistan government has said that its cricket team will not take the field for the upcoming T20 World Cup game against India in Colombo on February 15. Ending weeks of speculation, their government confirmed that they would travel to Sri Lanka to take part their place in Group A but they will skip the India clash. “The Government of the Islamic Republic of Pakistan grants approval to the Pakistan Cricket Ream to participate in the ICC World T20 2026,” their official handle posted. “However, the Pakistan Cricket Team shall not take the field in the match scheduled on 15th February 2026 against India.” There have been partial boycotts in World Cups before (West Indies and Australia in 1996 and New Zealand and England in 2003) so Pakistan may argue that they are doing what other teams have done before. But the International Cricket Council (ICC) may be opening informal twoway communications to ensure they can convince them to honour an agreement. With both countries deciding on a hybrid model to face each other in ICC and ACC events after a dramatic fall in diplomatic relations, there was no threat to this match. But the issue snowballed after the BCCI directed Kolkata Knight Riders to drop Mustafizur Rahman fro the roster this year. The BCCI said it was due to recent ‘developments’. As a consequence, Bangladesh wanted their World Cup matches to be moved out of India. When that was denied, Pakistan showed their support and threatened to withdraw. They were the only ones to vote in favour of Bangladesh during the ICC board meeting that voted Bangladesh out. An ICC response is awaited. It needs to be seen if Pakistan play India if both teams reach the final. Another sticky subject would be broadcast revenue. India-Pakistan match always considered highest grosser. If the match doesn’t take place what happens to it?