ChatGPT generated image by The Tech Panda
As a watershed moment for India’s growth story, Union Budget 2026 will be a leap from simply being digitally adopted to actually creating deep tech and robust industrial capabilities. The Finance Minister Nirmala Sitharaman explained that the budget has a multipronged strategy to promote growth, “Intelligence-First” digital infrastructure; a Decentralised approach for Startups; and Structural Efficiency for Manufacturing.
In addition to placing high priority on operationalising the Anusandhan National Research Fund, the budget expressly states the intent to create domestic Intellectual Property by launching new Capacity Building AI Missions. Further, the budget builds on the current scaling of the GENESIS program, and the announcement of the INR10,000 Crore SME Growth Fund provides an architectural framework to democratise innovation, thereby creating an ecosystem that supports the next level of unicorn companies in Tier-2 and Tier-3 cities (Bharat).
Abhinav Arora, CEO & MD, EOSGlobe
“Budget 2026 clearly positions India as a global hub for cloud and data services. Long-term tax certainty, a practical safe-harbour framework, and the requirement for local reseller participation make India far more attractive for global business. For the BPM sector, this strengthens our ability to scale delivery from India, expand beyond metros, and bring global work closer to skilled local talent.”
Shashank Karincheti, Co-founder & CPO, Redacto.ai
“The data center tax holiday till 2047 is a watershed moment for India’s digital economy. By incentivizing foreign cloud providers to process data onshore with a 15% safe harbour for related-party services, the government has effectively removed the biggest barrier to DPDP Act compliance. Until now, enterprises faced an impossible trade-off between global-scale cloud infrastructure and data localization requirements. This budget resolves that tension—more onshore data processing means consent management becomes enforceable, data principal rights become actionable, and cross-border transfer headaches reduce significantly. For privacy-conscious enterprises, especially in regulated sectors, this is the infrastructure foundation they’ve been waiting for.
“However, data localization alone doesn’t equal privacy. The real work begins after data lands in India—robust consent management, third-party risk governance, and demonstrable accountability remain non-negotiable. Enterprises that treat onshore hosting as a checkbox will find themselves exposed when DPDP enforcement begins in earnest. The budget creates the infrastructure opportunity; building genuine privacy operations capability is what will separate compliant organizations from vulnerable ones.”
Pinkesh Kotecha, Chairman & MD, Ishan Technologies
“The Union Budget 2026–27 marks a decisive shift in positioning digital infrastructure as a strategic national asset. Long-term tax holiday for global cloud players using Indian data centres and safe harbour provisions provide much-needed certainty and the recognition of cloud and DCs alongside core infrastructure send position India as a credible hub for digital infrastructure serving global markets.
“What stands out is the strong alignment between policy intent and execution, from sovereign cloud enablement and AI-ready data centre capacity to accelerated city-level digital infrastructure across Tier 2 and Tier 3 markets. This clearly favours players with pan-India footprints and the ability to deliver connectivity, data centres, cloud, and managed services as an integrated stack. As enterprises, governments, and high-tech industries increasingly run mission-critical, data-intensive workloads, continued support for compliant, India-hosted cloud and resilient networks will be essential. The Budget lays a solid foundation for infrastructure-led digital growth and positions integrated infrastructure providers to emerge as default digital partners in India’s next phase of industrial, cloud, and AI-driven expansion”.
Vikram M. Raichura, Founder & MD, Helo AI
“We welcome the Government’s proposal to offer a tax holiday till 2047 for foreign cloud service providers operating from India through local data centres. This sends a strong signal of long-term policy stability, which is critical for cloud and data centre investments that require large, long-term commitments.
“By encouraging global cloud companies to build and operate from India for their international operations, the policy helps position India as a base for global cloud infrastructure rather than only a consumption market. The requirement for foreign players to serve Indian customers through local reseller entities can also create opportunities for Indian partners, support job creation, and strengthen the supporting ecosystem.
“For AI, SaaS and deeptech companies, the actual impact will depend on how clearly the policy is implemented and whether it translates into lower infrastructure costs and fewer operational hurdles. With effective execution, this measure can help attract long-term investment and reinforce India’s role in the global cloud and digital services landscape.”
Harishanker Kannan, CEO & Co-founder, Scalefusion
“With a strong focus on IT services, expansion of data centre infrastructure, cloud adoption, and enabling cross-border digital operations, India’s Union Budget clearly reinforces the country’s ambition to emerge as a leading global digital and technology powerhouse. The policies encouraging cloud innovation, strategic data infrastructure and seamless global connectivity will lay foundation for faster adoption of secure and scalable digital solutions by enterprises around the world. For organisations managing distributed teams and devices, this evolving landscape creates an ideal environment to implement resilient, compliant, and future-ready IT systems at scale, an opportunity we at Scalefusion are proud to help enable.”
Narendra Sen, Founder & CEO, RackBank Data Centers
“We welcome the Union Budget 2026–27 as a strong and investor-positive signal at a time when global capital is actively comparing India with other data centre markets. India already contributes nearly 20 percent of the global data economy, while the global data centre market stands at approximately 120 GW. Even capturing one percent of this opportunity highlights the scale of the current capacity gap and the headroom for growth.
“With deployed capacity still at an early stage, India has the potential to reach nearly 10 GW over the next five years, translating into investments of close to USD 70–100 billion across data centre infrastructure. Long-term tax certainty through the proposed tax holiday significantly improves return visibility for global investors, including infrastructure funds and real estate-focused capital, and makes Indian data centre platforms more attractive as a long-term asset class.
“India’s advantage is not limited to policy support. Build costs in India are among the lowest globally at approximately USD 5 million per megawatt, compared to USD 10–12 million in several international markets, materially improving project economics. Combined with domestic manufacturing capability, reduced import dependence, and a strong clean energy ecosystem across solar and wind, the operating environment is structurally competitive.
“For companies like RackBank, this Budget strengthens confidence to expand capacity, attract global capital and support the delivery of scalable, secure and sovereign digital infrastructure for both Indian and international customers.”
Satya Yeruva, Co-Founder & CEO, FinStackk
“It is a positive step that the Union Budget has enhanced the safe harbour threshold for IT services to Rs 2,000 crore from Rs 300 crore. Bringing all IT companies under a single, uniform safe harbour category will simplify compliance, reduce uncertainty, and make tax obligations far more predictable. This change benefits not just small and mid-sized companies, but larger firms as well, lowering the risk of litigation and enabling them to expand globally with confidence. The allocation of Rs 10,000 crore as a growth fund for startups and MSMEs is equally encouraging, as it provides the capital and support needed to scale their operations, innovate, and contribute to India’s growing digital economy. Measures like these reinforce India as a stable and attractive base for technology-driven businesses while fostering entrepreneurship and long-term growth.”
Girish Hirde, Global Delivery Head, Infovision
“As India’s IT services industry and GCC ecosystem continue to scale, the upcoming Union Budget presents an opportunity to reinforce the fundamentals that enable consistent, high-quality delivery. Continued investment in secure, reliable digital and physical infrastructure will further strengthen India’s position as a preferred destination for global capability centers and long-term client programs. In parallel, clear policy direction on AI adoption and workforce readiness will be critical to building a world-class, innovation-driven engineering talent base that can deliver sustained value with confidence and predictability.”
Subhasis Majumdar, Managing Director, Vertiv India
“The Union Budget 2026-27 positions India as a serious global player in digital infrastructure and cloud services. The long-term tax holiday for foreign cloud companies until 2047 is a game-changing move. This move will dramatically improve investment and make India significantly more competitive. As a global leader in critical infrastructure that powers data centres, AI factories, hyperscale campuses, and cloud environments, we see this as a direct accelerator for the high-density, high-efficiency facilities that will define tomorrow’s digital economy. Our advanced power systems, liquid cooling technologies, and integrated rack solutions are purpose-built to support exactly this scale of sustainable, AI-ready build-out.
“Equally important is the much-needed relief given to the broader IT services industry. These measures will bring huge relief in compliance burden and allow companies to focus on business growth and innovation. Together, this will attract large global cloud investment, drive massive new data centre capacity, create a huge multiplier effect for power, cooling, critical infrastructure and digital ecosystem players. We firmly believe that this budget will accelerate India’s emergence as a global digital infrastructure powerhouse.”
Atul Rai CEO & Co-founder, Staqu Technologies
“The Union Budget 2026–27 clearly recognises artificial intelligence as a strategic driver of inclusive growth and governance efficiency. The emphasis on AI missions, research funding, semiconductor ecosystem development, and capacity building reflects a shift from experimentation to deployment at scale. By aligning AI with national priorities such as infrastructure, public services, logistics, and security, the government is creating a robust ecosystem for applied artificial intelligence.
“Equally important is the focus on skilling and education-to-employment pathways, which will ensure that AI adoption is supported by a future-ready workforce. As AI becomes embedded across sectors, solutions that translate advanced research into real-world applications will play a critical role in enhancing productivity, safety, and operational efficiency across India’s rapidly expanding digital and physical infrastructure.”
Venka Reddy, CPO, QualiZeal
“Budget 2026 marks a transformative era for India’s 6-million strong tech workforce. The formation of the ‘Education to Employment and Enterprises Standing Committee’ is the strategic bridge we need to turn academic potential into industry-ready AI leadership. As India pursues a 10% share of the global services market, the Finance Minister’s focus on the socio-economic impact of AI is a masterstroke in pragmatic planning.
“By embedding content creator labs in 15,000 schools and doubling down on AI Centers of Excellence, we are finally democratizing high-tech opportunity. For QualiZeal, as we scale toward 3,500 innovators by 2028, the budget’s commitment to girls’ hostels in STEM and regional hubs is a game-changer. It allows us to build a workforce that is not only ‘AI-native’ but truly inclusive. This isn’t just a fiscal policy; it is a declaration that India will not just participate in the AI revolution—we will lead it.”
Keshava Murthy, CEO & Co-founder, Matters.AI
“Budget 2026 clearly signals the government’s intent to mainstream AI across governance, education, and agriculture—through the AI Mission, the Education-to-Employment Standing Committee, and platforms like Bharat-VISTAAR. As AI moves from experimentation into everyday workflows across public systems, enterprises will mirror this adoption internally. That shift brings a new challenge: organisations must gain visibility into how AI systems interact with sensitive data. The next phase of AI adoption will be defined not just by capability, but by oversight.”
Rohit Kumar, Founding Partner, The Quantum Hub (TQH)
“The Budget clearly prioritises building domestic capability and reducing strategic dependencies, while positioning AI as a governance and productivity multiplier. The focus on compute, semiconductors, and data infrastructure is directionally right and the taxation measures – tax holidays for investments in data centres, customs duty exemptions for capital goods for nuclear power and critical minerals, and expanded safe harbour provisions – are especially promising. Together, these signal a shift towards a more trust-based regulatory regime, where the government places greater faith in businesses rather than defaulting to bad faith assumptions. If implemented well, this approach could reduce litigation, improve investor confidence, and mark a meaningful change in how the state engages with business – ultimately supporting stronger economic growth.
“Having said that, the Budget stops short of addressing harder questions around sustained R&D funding, private-sector innovation incentives, and long-term access to frontier AI capabilities.”
Himanshu Tyagi, Professor, Indian Institute of Science & Co-founder, Sentient
“It’s encouraging to see the Union Budget 2026 reaffirm strong support for the AI Mission and the use of AI as a force multiplier for governance. India has always created outsized impact at unprecedented scale, often by adapting within complexity rather than waiting for perfect conditions. AI now changes the equation, because intent-driven systems align far more closely with that institutional strength than traditional software. The focus on jobs and skills is also critical—and open-source AI can help ensure this transition expands opportunity by allowing more builders across India to contribute directly.”
Bruce Keith, CEO & Co-Founder, InvestorAi
“The ongoing fiscal discipline and general move towards tax harmonisation is welcome. Adding more heft and focus on education in a world where AI is changing the rules also makes sense. Perhaps the biggest surprise to me was the increases in Securities Transaction Tax (STT) on futures and options premium by 150% and 50% respectively.
“The Government doesn’t like that 90%+ people lose money in F&O so have chosen to make it more expensive. In my view this is the wrong lever to this problem. Better to look at education and AI rather than risk collateral damage from a reduction in big volume players causing liquidity to shrink. The overall market needs this to function.”
Ankur Mittal, Co-Founder, Inflection Point Ventures
“India’s service led economy can get disrupted with strong gains in AI and hence govt focus on building India as a powerhouse of strong AI talent is a great step to retain our continued growth in the world economy. This will also increase great flow of capital to India from global tech giants to take advantage of the talent pool while also supporting the indian startup ecosystem.”
Madhu Rajputra Peravalli, Co-founder, Troogue
“Budget 2026 introduces a few important clarifications that are relevant for companies operating at the intersection of AI, digital services, and workforce platforms. The explicit treatment of manpower services under contractor TDS removes an area of ambiguity that enterprises and talent platforms have navigated for years. The continued emphasis on AI as core digital infrastructure, along with references to ethical AI, skills mapping, and responsible technology adoption, reflects the direction in which the ecosystem is moving.”
Ritu Mehrotra, CEO & Co-Founder, Shunya Labs
“Union Budget 2026’s focus on AI-driven skilling, incentives for sovereign digital infrastructure, and the growth of services exports creates a strong launchpad for Indian deeptech startups. Initiatives such as the AI Impact Panel and tax holidays extending till 2047 will accelerate innovation in privacy-first, multilingual AI solutions, powering the next wave of enterprise adoption across sectors.”
Vipul Prakash, Founder & CEO, FireAI
“We applaud the Government’s Intelligence-First vision in the Union Budget 2026. The specific allocation for Capacity Building AI Missions and the operationalization of the Anusandhan National Research Fund are landmark steps. They signal a shift from simply adopting technology to deepening our indigenous R&D capabilities.
“For the Indian tech ecosystem, the commitment to emerging technologies as a driver of inclusive growth is encouraging. When combined with the INR10,000 Crore SME Growth Fund, this Budget creates a powerful flywheel. The Research and Development and Innovation Fund will build the tech, and the Capacity Building Missions will ensure our workforce is ready to use it. At FireAI, we are ready to support this vision by helping these newly empowered businesses turn data into their strongest asset.”
Sanjay Lodha, CMD, Netweb Technologies
“The Union Budget 2026–27 rightly places technology and services at the centre of India’s growth strategy, emphasizing that emerging technologies such as artificial intelligence will drive jobs, innovation, and exports in the years ahead. By proposing a high-powered committee to unlock the full potential of the services sector and assess how technologies like AI will impact jobs and skills, the government is laying the groundwork for a future-ready economy. The goal of making India a global leader in services exports by 2047 reflects a long-term vision that aligns strongly with industry aspirations. India’s ambition to move from being a software-led economy to a full-stack technology nation.
“This Budget reinforces our belief that strong digital and compute infrastructure, alongside accessible AI capabilities, will be critical to India’s competitiveness. As businesses, government institutions, and academia increasingly adopt AI, high-performance computing, AI-ready data centres, and purpose-built technology platforms will become essential enablers for real-world deployment at scale.
“The emphasis on skills and education also highlights the growing need for AI lab infrastructure, where students, researchers, and professionals can gain hands-on experience with advanced compute and AI systems. Building such AI labs and research environments is crucial to translating policy intent into practical capability, and this is an area where domestic technology infrastructure plays a key role.
“Budget 2026–27’s focus on supporting emerging technologies, expanding digital infrastructure, and generating skilled jobs across sectors such as IT, finance, healthcare, manufacturing, and education will accelerate digital transformation. These initiatives will not only help Indian technology firms innovate faster but also strengthen the broader IT and services ecosystem by creating high-value employment, enhancing global exports, and driving productivity gains across industries.”
Akshay Chhabra, CMD, 1Point1 Solutions Limited
“The Union Budget 2026–27 signals that India is moving beyond AI adoption to making AI a core engine of economic growth. A key highlight is the recognition of data centres as critical national infrastructure—a timely move that underscores the foundational role of digital infrastructure in an AI-led economy.
“The proposed tax holiday until 2047 for global cloud service providers operating data centres in India sends a strong signal to long-term investors and hyperscalers. It encourages sustained capital commitment, accelerates large-scale infrastructure build-out, and strengthens India’s position in the global cloud, AI, and digital services value chain. Incentives for cloud and hyperscale providers not only expand infrastructure capacity but also enhance institutional capability, talent readiness, and ecosystem maturity.
“Together, these steps reinforce India’s readiness to lead responsibly in a digital- and intelligence-driven global economy. For companies with deep AI integration and global operations, this Budget highlights a clear reality: AI is no longer a future roadmap it is today’s operating reality, and India is ready to lead from the front.”
Sachin Panicker, Chief AI Officer, Fulcrum Digital
“The Union Budget 2026-27 recognises that artificial intelligence is no longer an experimental technology but a strategic lever for governance, productivity and economic growth. It has specifically highlighted AI applications to enhance governance and introduced measures such as the AI Mission, National Quantum Mission and significant new funding through the Anusandhan National Research Foundation and the Research and Development and Innovation Fund. At Fulcrum Digital, we believe the 21st century’s true potential lies in shifting from simple automation to Intelligence Amplification (IA). By backing R&D and innovation funds, the government is providing the essential fuel for enterprises to move beyond experimentation to real-world, scalable impact.
“Equally important is the decision to substantially enhance the safe harbour threshold for IT services from INR300 crore to INR2,000 crore, which will significantly reduce compliance friction and improve operating certainty for a much broader set of technology firms. This move aims to strengthen India’s technology ecosystem by expanding research capacity, supporting translational innovation and building future capabilities in sectors such as agriculture, healthcare, education and public services. For this framework to create measurable impact we need coordinated implementation with industry and academia, greater focus on data and compute infrastructure, and skilling pathways that align with the evolving demand for specialised AI talent.”
Dinakar Menon, Managing Partner & Business Head, BigTrunk Communications
“When we look at this Budget through the lens of the marketing industry, the message is clear that artificial intelligence is no longer a future tool but a present-day growth engine. The decision to increase funding for AI-powered, industry-linked labs in Tier 2 and Tier 3 institutions is especially important because it expands the talent and innovation base beyond metros and brings applied intelligence closer to real business problems. For marketing, where content, consumer insight, and automation now depend heavily on data and machine learning, this creates a stronger pipeline of skills and solutions. The formation of a standing committee to study the impact of emerging technologies on jobs also reflects a balanced approach that ecentrali both opportunity and responsibility. With sustained support through national AI and research missions, India has a chance to build a marketing ecosystem that is smarter, more export-ready, and globally competitive while remaining inclusive and future-facing.”
Sunil Jose, President, Workday India
“This year’s Budget places people, skills, and AI at the centre of India’s long-term growth agenda. By encouraging large-scale AI investments and inviting global organisations to build and innovate in India through tax incentives extending up to 2047, the government is reinforcing India’s ambition to become a global hub for talent and technology. The focus on education-to-employment pathways, continuous skilling, and AI-enabled workforce transformation reflects a clear understanding of how work is evolving. For organisations, sustained investments in skills, workforce agility, and human-centric technology will be critical to driving productivity and inclusive growth.”
Vikram Labhe, Founder & CEO, Melooha
“When we look at where innovation is headed today, it is clear that most breakthroughs are being built on an AI backbone. There is a sharp and growing demand not just for skilled professionals, but for original ideas that can be translated into real economic value. It is encouraging to see the government ecentral this shift and respond with a meaningful increase in funding for AI-powered, industry-linked labs, especially across Tier 2 and Tier 3 institutions. This focus helps ecentralize innovation and brings high-quality research closer to where talent is emerging. For companies like Melooha, this creates a stronger pipeline of ideas, skills, and applied intelligence. With sustained support for AI and targeted backing for MSMEs, we can expect a new wave of solutions across sectors that are locally rooted, globally relevant, and capable of shaping the next phase of India’s digital economy.”
Sree Balaji, Co-Founder & Group CEO, iLink Digital
“We welcome the Union Budget 2026’s strong focus on AI and digital infrastructure, which positions emerging technologies as central to industrial competitiveness. Initiatives such as the India AI Mission and the recognition of AI as a force multiplier for governance and enterprise operations create a positive outlook for AI-led modernisation across manufacturing and services. As adoption deepens, enterprises will increasingly prioritise scalable, secure, and data-driven technology solutions to enhance productivity and resilience. We look forward to being part of India’s AI-led growth journey.”
India’s Animation, Visual Effects, Gaming and Comics (AVGC) sector is a growing industry, projected to…
With Union Budget 2026 now on the table, the government is prioritizing ease of doing…
Moreover, Budget 2026 expectations for MSMEs are around easier access to working capital, smoother execution…
As India’s healthcare ecosystem becomes increasingly digital-first, expectations from the Union Budget 2026 are rising…
For much of the last decade, the CISO role was defined by defense: reduce incidents,…
As India’s fintech ecosystem matures from rapid experimentation to large-scale adoption, expectations from Union Budget…