Budget 2026–27 Prioritises Sustainable Growth Over Short-Term Gains
Focus on fiscal prudence, completion certainty, and medium-term investment opportunities
New Delhi: A report released on Wednesday said that the Union Budget 2026–27 has prioritised sustainable growth, fiscal discipline, and certainty of execution rather than short-term measures aimed at pleasing the markets.
According to a report by PL Wealth, the wealth management arm of PL Capital, the medium-term outlook remains positive for several sectors, including infrastructure, capital goods, defence, logistics, manufacturing and engineering goods, textiles, and export-oriented sectors such as gems and jewellery.
The report noted that investors are likely to respond to improved clarity around domestic policy priorities and the India–US trade deal, which could lead to short-term sectoral rotation in equities.
On fixed income instruments, the firm said that bond markets may face short-term yield pressure due to increased supply and global interest rate uncertainty. However, in the medium term, higher yields improve the prospects for forward returns, especially for high-quality bonds.
The wealth management firm added that amid equity volatility and bond repricing, diversification tools such as infrastructure assets—including InvITs and REITs—private credit, and select private equity themes can be effectively used to balance portfolios.
Commenting on the budget, the report stated that higher borrowing and liquidity adjustments may cause intermittent volatility across asset classes. However, these should be viewed as transitional effects rather than signs of macroeconomic stress.
For long-term investors, the budget reinforces confidence in India’s medium-term growth trajectory, which is supported by sustained public investment, deeper manufacturing capabilities, expansion in services, and institutional continuity.
PL Wealth Management CEO Inderbir Singh Jolly said, “In this environment, a disciplined approach to asset allocation, prudent duration management, and selective exposure to structural growth sectors remains the most effective strategy to build wealth while navigating short-term uncertainty.”
The report further highlighted that the medium-term investment case for markets continues to rest on public capital expenditure, manufacturing incentives, and policy consistency.
It added that the policy stance prioritises sustainable capital formation, domestic manufacturing, and competitiveness in services, even as fiscal consolidation progresses at a calibrated pace. With capital expenditure rising 11.5 percent year-on-year to ₹12.2 lakh crore and the fiscal deficit pegged at 4.3 percent of GDP, the budget strikes a balance between growth support and macroeconomic stability.
