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Introduction

The Union Budget 2026-27 introduces the “Three Kartavyas” comprising accelerating economic growth, fulfilling aspirations through capacity building, and ensuring equitable access to resources. This framework marks a paradigm shift, transitioning from a singular focus on GDP expansion to a multi-dimensional approach that prioritizes inclusive participation and long-term economic resilience in an uncertain global landscape.

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Shift Towards Inclusive and Resilient Development

• Productivity-Led Resilient Growth: The first Kartavya shifts the focus from simple fiscal stimulus to enhancing structural productivity and global competitiveness to withstand external shocks.
  Eg: The launch of ISM 2.0 and the Biopharma SHAKTI scheme (₹10,000 crore) aims to build self-reliance in high-tech supply chains.
• Human-Centric Capacity Building: The second Kartavya positions citizens as “active partners” rather than passive beneficiaries by linking education directly to enterprise.
  Eg: The establishment of a High-Powered ‘Education to Employment and Enterprise’ Standing Committee targets a 10% global share in services by 2047.
• Targeted Resource Equity: The third Kartavya aligns with ‘Sabka Saath, Sabka Vikas’, moving beyond general welfare to ensuring the “last mile” has tangible access to growth tools.
  Eg: The Bharat-VISTAAR AI platform integrates AgriStack data to provide customized productivity advisory to small and marginal farmers.
• Infrastructure as Social Connector: Transitioning from “mega-projects” to growth connectors that reduce regional disparities and logistics costs.
  Eg: The proposal for seven high-speed rail corridors (e.g., Hyderabad-Bengaluru) seeks to transform Tier-II cities into economic hubs.

Associated Challenges

• Execution Bottlenecks: Translating broad “Kartavyas” into ground-level outcomes requires seamless coordination between Central and State governments, which often faces political friction.
• Private Investment Inertia: Despite a record Capex outlay of ₹12.2 lakh crore, private consumption remains muted, potentially limiting the “crowding-in” effect of public spending.
• Skill-Market Mismatch: Rapid technological shifts like AI pose a risk of “jobless growth” if capacity building doesn’t keep pace with industry-led research (KPMG 2026).
• Fiscal Consolidation Pressure: Maintaining a 4.3% fiscal deficit target while funding ambitious new schemes like Rare Earth Corridors may squeeze spending in other social sectors.

Way Forward to Deal with Challenges

• Outcome-Based Financing: Implementing the “reform-cum-results” mechanism, as seen in the City Economic Regions (CER) plan, to ensure accountability at the local level.
  Eg: The ₹5,000 crore allocation per CER is contingent on meeting specific developmental milestones.
• Leveraging Digital Public Infrastructure: Scaling tools like ONDC and TReDS to formalize MSMEs and ensure they have access to low-cost credit.
• Strengthening Federal Cooperation: Using the 16th Finance Commission framework to incentivize states to align with the national “Kartavya” roadmap.
• Strategic Global Integration: Reducing import dependencies in critical minerals and energy to insulate the domestic economy from geoeconomic volatility.

Conclusion

The Budget 2026-27 is a “credible effort” that prefers long-term competitiveness over short-term fiscal optics. By moving from a growth-centric model to a duty-driven (Kartavya) framework, India is laying the foundation for a structurally agile economy. The success of this shift will ultimately depend on whether intent can be converted into performance-led outcomes for the common man.

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