Senate Democrats Block DHS Measure as Funding Deadline Approaches
Lawmakers say they remain far apart on deal for Homeland Security to put new restrictions on immigration enforcement
Lindsay Wise and Anvee Bhutani Updated Feb. 12, 2026 WSJ
WASHINGTON—The Department of Homeland Security is on the verge of a shutdown after Senate Democrats voted to block a bill to fund the agency, saying negotiations with Republicans to put new restrictions on immigration enforcement hadn’t made enough progress.
A bill to fund DHS through September failed to advance with 52 in favor and 47 opposed, short of the 60 votes required. Republicans control the Senate 53-47 but need Democratic support to pass most bills due to the longstanding filibuster rule.
Democratic Sen. John Fetterman of Pennsylvania voted with Republicans to advance the bill, while Senate Majority Leader John Thune (R., S.D.) switched his vote from yes to no to preserve his ability to bring the bill up again. Sen. Mitch McConnell (R., Ky.) was absent.
DHS oversees Immigration and Customs Enforcement and Customs and Border Protection as well as the Federal Emergency Management Agency, the Transportation Security Administration and the U.S. Coast Guard. While the failed vote sets the stage for funding to lapse at DHS for at least a week, there isn’t expected to be any significant impact on border enforcement from the shutdown.
Democrats have demanded that Republicans agree to an overhaul of DHS as a condition of funding it, following the fatal shootings of two American citizens by federal immigration officers in Minnesota last month. Earlier Thursday, the Trump administration said it was ending its immigration crackdown in the state amid public outcry.
Lawmakers have passed legislation to fund every other part of government through the end of the fiscal year in September, but they split off the DHS bill to allow time for more negotiations. A two-week stopgap funding patch expires after Friday.
“If they don’t propose something that’s strong, that reins in ICE, that ends the killing—don’t expect our votes,” said Senate Minority Leader Chuck Schumer (D., N.Y.).
Senate Majority Leader John Thune (R., S.D.) was pessimistic about the potential for a deal on DHS funding.Michael M. Santiago/Getty Images
Democrats want an end to roving street patrols by immigration agents, tighter rules governing warrants and use of force, independent investigations for officer misconduct and a prohibition on agents wearing masks. They also want to require agents to use body cameras and carry identification. Republicans have rejected some of the ideas—notably on masks—and have introduced their own demand to end so-called sanctuary cities.
President Trump said Thursday that Democratic demands will make law enforcement officers “totally vulnerable” and “put them in a lot of danger.” He added that some of the demands are “very hard to approve…We have to protect our law enforcement.”
Thune was so downbeat about the potential for a deal that he allowed senators to go ahead with their plans to leave Washington for a weeklong recess, despite the imminent shutdown, while making clear they might need to return quickly to vote. Both the Senate and the House are scheduled to be out of session next week because of the Presidents Day holiday, and many lawmakers are headed to a security conference in Munich this weekend.
If DHS funding lapses, essential workers will continue to report to their jobs, while other workers could be furloughed. Also, ICE and Customs and Border Protection have additional funding from Trump’s tax law last year that could be tapped to keep their operations running and avoid missed paychecks. Other workers in DHS could start to miss pay if the shutdown drags on.
A bill to fund DHS through September failed to advance with 52 in favor and 47 opposed, short of the 60 votes required.
In a speech ahead of the vote, Thune complained that Democrats were rejecting “a reasonable good-faith offer” from the White House, though he didn’t say what that offer entailed. “Now, I’m not sure if Democrats thought the White House would just agree to every one of their demands or what, but they cannot reasonably expect to reach an agreement without actual negotiations from both sides,” he said.
Democrats on Saturday released a draft legislative text that included their proposals. The White House sent text of a counteroffer to Democrats late Wednesday, but none of the negotiators have publicly released it or described its contents.
Several Democratic senators said earlier this week that the White House has rejected key parts of Democrats’ demands.
A border patrol truck near the border wall this month in Nogales, Ariz. Ash Ponders/Bloomberg News
“I see no sign that they’re willing to accept the core protections: judicial warrants, body cameras, a right of action against ICE agents who break the law,” said Sen. Richard Blumenthal (D., Conn.).
Sen. John Barrasso (R., Wyo.), the No. 2 Senate Republican, in a speech Thursday, said that Republicans thought “many of the Democrat demands would undermine public safety and the rule of law, and so do the American people. They agree with us.”
In a sign of how dug in Democrats are, centrists who opposed the record-length government shutdown in the fall—largely over a failed effort to extend enhanced Affordable Care Act subsidies—said this week they would oppose even a short-term funding patch to keep DHS open for a matter of weeks while negotiations continued.
“I am not going to support [a stopgap bill] if my Republican colleagues can’t come to the table and work with us right now and get this done,” said Sen. Catherine Cortez-Masto (D., Nev.), who voted against the last shutdown.
Cortez-Masto said she didn’t think the GOP and the White House were working in good faith with Democrats on overhauling the department.
“All we’re proposing is that ICE abide by the same rules that police forces—state police and municipal police—abide by across the country,” said Sen. Angus King (I., Maine), who caucuses with Democrats and opposed last fall’s shutdown. “Pretty straightforward.”
Insights from SSA Cyclone Ditwah Survey: More State support needed for Malaiyaha community
Central Province experienced not just flooding but also the most number of landslides in the island Source: File photo By Shashik Silva Daily Mirror
Early warnings hadn’t reached many areas. Some data collectors said they themselves never heard any warnings in estate areas, while others mentioned that early warnings were issued but didn’t reach some segments of the community
When climate disasters strike, they don’t affect everyone equally. Marginalised communities typically face worse outcomes, and Cyclone Ditwah is no exception. Especially in a context where normalcy is far from ‘normal’, the idea of returning to normalcy or restoring a life of normalcy makes very little sense.
The islandwide survey conducted by the Social Scientists’ Association (SSA), between early to mid-January on Cyclone Ditwah shows stark regional disparities in how satisfied or dissatisfied people were with the Government’s response. While national satisfaction levels were relatively high in most provinces, the Central Province tells a different story.
The Central Province (Sinhala: මධ්යම පළාත, Tamil: மத்திய மாகாணம்) is one of the nine provinces of Sri Lanka, covering an area of approximately 5,674 square kilometers. It is home to a diverse population of around 2.8 million people and includes three main districts: Kandy, Matale, and Nuwara Eliya. The capital city is Kandy.
Only 35.2% of Central Province residents reported that they were satisfied with early warning and evacuation measures, compared to 52.2% nationally. The gap continues across every measure just 52.9% were satisfied with immediate rescue and emergency response, compared with the national figure of 74.6%. Satisfaction with relief distribution in the Central Province is 51.9% while the national figure stands at 73.1%. The figures for restoration of water, electricity, and roads are at a low 45.9% in the central province compared to the 70.9% in national figures. Similarly, the satisfaction level for recovery and rebuilding support is 48.7% in the Central Province, while the national figure is 67.0%.
A deeper analysis of the SSA data on public perceptions reveals something important: these lower satisfaction rates came primarily from the Malaiyaha Tamil population. Their experience differed not just from other provinces, but also from other ethnic groups living in the Central Province itself.
The Malaiyaha Tamil community’s vulnerability didn’t start with the cyclone. Their vulnerability is a historically and structurally pre-determined process of exclusion and marginalisation. Brought to Sri Lanka during British rule to work for the empire’s plantation economies, they have faced long-term economic exploitation and have repeatedly been denied access to state support and social welfare systems. Most estate residents still live in ‘line rooms’ and have no rights to the land they cultivate and live on. The community continues to be governed by an outdated estate management system that acts as a barrier to accessing public and municipal services such as road repair, water, electricity and other basic infrastructures available to other citizens.
As far as access to improved water sources is concerned, the Sri Lanka Demographic Health Survey (2016) shows that 57% of estate sector households don’t have access to improved water sources, while more than 90% of households in urban and rural areas do. With regard to the level of poverty, as the Department of Census and Statistics (2019) data reveals, the estate sector where most Malaiyaha Tamils live had a poverty headcount index of 33.8%; more than double the national rate of 14.3%. These statistics highlight key indicators of the systemic discrimination faced by the Malaiyaha Tamil community.
Some crucial observations from the SSA data collectors who had enumerated responses from estate residents in the survey reveal the specific challenges faced by the Malaiyaha Tamils, particularly in their efforts to seek state support for compensation and reconstruction.
First, the Central Province experienced not just flooding but also the most number of landslides in the island. As a result, some residents in the region lost entire homes, access roadways, and other basic infrastructures. The lost of lives, livelihoods and land were at a higher intensity compared to the provinces not located in the hills. Most importantly, the Malaiyaha Tamil community’s pre-existing grievances made them even more vulnerable and the government’s job of reparation and restitution more complex.
Early warnings hadn’t reached many areas. Some data collectors said they themselves never heard any warnings in estate areas, while others mentioned that early warnings were issued but didn’t reach some segments of the community. According to the resident data collectors, the police announcements reached only as far as the sections they were able to drive their vehicles, and there were many estate roads that were not suitable for vehicles. When warnings did filter through to remote locations, they often came by word of mouth and information was distorted along the way. Once the disaster hit, things got worse: roads were blocked, electricity went out, mobile networks failed and people were cut off completely.
Emergency response was slow. Blocked roads meant people could not get to hospitals when they needed urgent care, including pregnant mothers. The difficult terrain and poor road conditions meant rescue teams took much longer to reach affected areas than in other regions.
Relief supplies didn’t reach everyone. The Grama Niladhari divisions in these areas are huge and hard to navigate, making it difficult for Grama Niladharis to reach all places as urgently as needed. Relief workers distributed supplies where vehicles could go, which meant accessible areas got help while remote communities were left out.
Some people didn’t even try to go to safety centres or evacuation shelters set up in local schools because the facilities there were already so poor. The perceptions of people who did go to safety centres, as shown in the provincial data, reveal that satisfaction was low compared to other affected regions of the country. Less than half were satisfied with space and facilities (42.1%) or security and protection (45.0%). Satisfaction was even lower for assistance with lost or damaged documentation (17.9%) and information and support for compensation applications (28.2%). Only 22.5% were satisfied with medical care and health services below most other affected regions.
Restoring services proved nearly impossible in some areas. Road access was the biggest problem. The condition of the roads was already poor even before the cyclone, and some still haven’t been cleared. Recovery is especially difficult because there’s no decent baseline infrastructure to restore, hence you can’t bring roads and other public facilities back to a ‘good’ condition when they were never good, even before the disaster.
Water systems faced their own complications. Many households get water from natural sources or small community projects, and not the centralised state system. These sources are often in the middle of the disaster zone and therefore got contaminated during the floods and landslides.
Long-term recovery remains stalled. Without basic infrastructure, areas that are still hard to reach keep struggling to get the support they need for rebuilding.
Taken together, what do these testaments mean? Disaster response can’t be the same for everyone. The Malaiyaha Tamil community has been double marginalised because they were already living with structural inequalities such as poor infrastructure, geographic isolation, and inadequate services which have been exacerbated by Cyclone Ditwah. An effective and fair disaster response needs to account for these underlying vulnerabilities. It requires interventions tailored to the historical, economic, and infrastructural realities that marginalised communities face every day. On top of that, it highlights the importance of dealing with climate disasters, given the fact that vulnerable communities could face more devastating impacts compared to others.
(The article is based on a survey conducted by the Social Scientists’ Association of Sri Lanka in early to mid-January 2026. The writer is the Chief Operating Officer and a researcher of the association)
Bangladesh 2026 elections explained in maps and charts
With 127 million voters set for the February 12 election, Al Jazeera analyses key numbers for Bangladesh’s crucial vote.
By Alia Chughtai 9 Feb 2026
Published On 9 Feb 2026
Published On 9 Feb 20269 Feb 2026
On February 12, Bangladesh will head to the polls to elect its next government, 18 months after Prime Minister Sheikh Hasina was ousted from office by a student-led movement.
Hasina, the daughter of Sheikh Mujibur Rahman, the leader of the country’s independence movement, ruled Bangladesh between 1996 and 2001 and again from 2009 until she had to flee from office in August 2024 – after ordering a brutal crackdown on protesters which killed an estimated 1,400 people – and seek exile in India.
An interim administration led by Nobel laureate Muhammad Yunus has since led the country.
Here is everything you need to know about the upcoming general election:
Bangladesh at a glance
The 2026 elections are among the most consequential in the country’s 55-year history, since gaining independence from Pakistan in 1971.
With more than 173 million citizens, Bangladesh is the eighth most populous country globally and, over the past 25 years, its economy has been one of the fastest-growing in the world – though growth has cooled in recent years.
Bangladesh is a predominantly Muslim country, with more than 90 percent of the population following Islam, 8 percent practising Hinduism and the rest following other faiths.
Economically, the country’s gross domestic product (GDP) stands at $461bn, with a per capita income of $1,990.
According to the Bangladesh Bank, GDP expanded by 3.97 percent in the fiscal year ending June 2025, easing from a 4.22 percent rise in the previous year.
Millions of first-time voters
Bangladesh has one of the world’s youngest populations, with a significant portion under the age of 30.
Among those above the voting age of 18, approximately 56 million, or 44 percent, are between the ages of 18 and 37, and nearly 5 million are first-time voters.
Bangladesh is one of the most densely populated countries in the world, with 1,366 people per square kilometre (3,538 people per square mile). This density is nearly three times that of India and four times that of Pakistan.
The country’s largest city is the capital, Dhaka, which has a population of more than 37 million people – more than the entire population of Malaysia, Saudi Arabia or Australia.
How is the government structured?
Bangladesh is a parliamentary republic, where executive power is exercised by an elected government, consisting of the prime minister and cabinet.
The president of Bangladesh is the ceremonial head of state and is indirectly elected by the parliament for a five-year term.
The prime minister is the leader of the majority party or coalition in parliament.
The prime minister appoints the cabinet, oversees government policy and directs civil service.
Legislative authority rests with the Jatiya Sangsad, Bangladesh’s parliament. It consists of 350 seats, including 300 directly elected seats and 50 seats reserved for women, which are allocated proportionally based on their share of votes. Members serve five-year terms.
Administratively, Bangladesh is divided into eight divisions, 64 districts and 495 upazilas (councils). Local governments manage municipal services, education and rural development, though they depend heavily on funding and authority from the central government.
Political parties
In this 2026 election cycle, there are 59 registered political parties in Bangladesh, excluding the Awami League, Sheikh Hasina’s party, which has had its registration suspended by the election commission, nullifying its ability to field candidates in the polls.
Of these, 51 parties are actively participating in elections by fielding candidates. In total, 1,981 candidates are contesting, including 249 independent candidates.
Bangladesh Nationalist Party (BNP) – Led by Tarique Rahman, the son of recently deceased former Prime Minister Khaleda Zia.
The BNP is one of Bangladesh’s two major traditional parties and positions itself as a nationalist and conservative alternative to the Awami League.
Jamaat-e-Islami – The Islamic party, led by Shafiqur Rahman, advocates for politics rooted in the religion’s principles and has formed an electoral alliance with the National Citizen Party (NCP) along with other Islamic parties.
National Citizen Party (NCP) – Formed by student leaders of the 2024 uprising, it is a centrist party focused on citizen-led governance and political reform. It has garnered attention from younger voters and civil society groups due to increasing dissatisfaction with established parties.
Jatiya Party (JP-Quader) – This centre-right faction of the Jatiya Party is led by Ghulam Muhammed Quader.
Jatiya Party (JP-Ershad) – Led by Anisul Islam Mahmud, this centre-right party has its roots in the military rule of former President Hussain Muhammad Ershad in the 1980s.
Left Democratic Alliance – A coalition of left-wing parties, including the Communist Party of Bangladesh and several socialist groups.
Amar Bangladesh Party (AB Party) – A centrist party that presents itself as a reform-oriented alternative to the established political blocs, appealing to voters seeking a break from traditional party politics.
Previous election results
Bangladesh’s electoral history over the past two decades has been predominantly shaped by the Awami League, which came to power in 2009 after a significant defeat of the Bangladesh Nationalist Party (BNP) which had ruled from 2001 to 2006.
In the 2001 election, the Awami League suffered a major defeat, winning just 62 seats, while the BNP secured a commanding majority with 193 seats. That election marked the last clear transfer of power between the two major parties.
The balance shifted decisively in 2008, when the Awami League-led Grand Alliance returned to power in a landslide. Since then, the party has consolidated its dominance.
In 2014, with the BNP absent from the contest, Hasina’s Awami League again won in a landslide.
The party further strengthened its grip in the 2018 election, securing 300 seats, while the BNP was reduced to just seven seats, its weakest performance on record. Thousands of BNP leaders were arrested in the lead-up to the elections. The Jamaat was banned in 2015, and so it couldn’t contest. International observers and opposition groups described the election as neither free nor fair.
In the most recent 2024 election, the Awami League won 272 seats, maintaining a parliamentary majority. The BNP again boycotted, amid deepening repression of opposition leaders. The Jamaat was still banned.
Political leaders throughout history
Since Bangladesh’s independence in 1971 from Pakistan, the country’s turbulent political evolution has been shaken by internal conflicts, military intervention and fragile democratic institutions.
Sheikh Mujibur Rahman served as the country’s first president – the leader of the independence movement – who soon banned other political parties and adopted increasingly repressive policies.
Rahman was assassinated in 1975 by army officers, who killed him and most of his family. Only two members of his immediate family survived: his daughters, Sheikh Hasina and Sheikh Rehana, who were in West Germany during the attack, and then lived in India in exile. This event triggered a period of coups and counter-coups that established the military as a dominant political force in the country.
A policeman walks past a banner with a picture of Bangladesh’s founder Sheikh Mujibur Rahman, in Dhaka, Bangladesh [File:Munir Uz Zaman/AFP]
Following the assassination, cabinet minister Khondaker Mostaq Ahmad took control of the government until he was deposed in a counter-coup just months later, which led to the appointment of Chief Justice Abu Sadat Mohammad Sayem as a figurehead president.
In 1977, Major General Ziaur Rahman assumed the presidency, and a year later, he founded the Bangladesh Nationalist Party (BNP). His leadership blurred the lines between military and civilian governance. Zia, as he was called, was also assassinated in a failed coup attempt in 1981.
From 1982 to 1990, Bangladesh was ruled under a military dictatorship led by Hussain Muhammad Ershad, during which democratic institutions were weakened, and the presidency functioned as an instrument of centralised rule.
By the late 1980s, Zia’s wife and successor as BNP leader, Khaleda Zia, and Mujibur Rahman’s daughter Sheikh Hasina, joined forces to take on military rule and demand a return to democracy.
In 1990, under mounting pressure, Ershad resigned, paving the way for elections in 1991 that Khaleda won – becoming the country’s first female prime minister.
By then, the brief unity between Khaleda and Hasina had broken down. Over the next two decades, Bangladesh experienced a turbulent swapping of power between the BNP and Hasina’s Awami League. Hasina became PM in 1996, then Khaleda returned to power in 2001, and then Hasina won office again in 2009.
It would be the start of a 15-year stint marked by increasingly heavy-handed rule and repression of political opponents, accompanied by broad economic growth. By 2024, Bangladeshi youth had seen enough – and rose up in the revolt that ousted Hasina and led to this moment.
Finance Minister Nirmala Sitharaman presented the Union Budget for the financial year 2026–27 earlier today, February 1, 2026 in Parliament. The Budget is framed against a backdrop of global economic uncertainty, supply chain realignments, and evolving investment dynamics, while reaffirming India’s focus on sustained growth and fiscal discipline.
While presenting the Budget, the finance minister stated that the government aims to “transform aspiration into achievement and potential into performance.” She described this year’s Budget as a Yuva Shakti–driven Budget with proposals emphasising the strengthening of domestic manufacturing, scaling high-growth services, and reinforcing infrastructure as key drivers of long-term economic expansion.
Reflecting on the country’s growth journey so far, the finance minister also said, “We have pursued far-reaching structural reforms, fiscal prudence and monetary stability whilst maintaining a strong thrust on public investment. Keeping atmanirbharta as a lodestar, we have built domestic manufacturing capacity, energy security and reduced critical import dependencies.” She also said, “We have ensured that citizens must benefit from every action of the Government, undertaking reforms to support employment generation, agricultural productivity, household purchasing power and universal services to people.”
This year’s Union Budget underscores the importance of regulatory certainty, ease of doing business, and targeted reforms to attract long-term capital and deepen India’s integration with global markets.
Let's look at the key focus areas of the Union Budget 2026–27:
Budget theme
Yuva Shakti–driven growth: Converting India’s demographic dividend into productive capacity through skilling, employment, and enterprise creation.
Three Kartavya (duties) guiding this year’s Budget
Accelerating and sustaining economic growth by enhancing productivity, competitiveness, and resilience amid volatile global dynamics.
Fulfilling aspirations and building capacity by strengthening human capital, skills, and institutional capabilities.
Advancing Sabka Sath, Sabka Vikas by ensuring equitable access to opportunities across regions, communities, and sectors.
Investment-led development focus
Scaling manufacturing in strategic and frontier sectors.
Strengthening MSMEs as growth partners and supply-chain anchors.
Reinforcing services as a core driver of growth, employment, and exports.
Strengthening India’s investment ecosystem
Sustained public capital expenditure to crowd in private investment.
Infrastructure-led regional development, especially in Tier II and Tier III cities.
Long-term energy security, climate technologies, and resource resilience.
Enhancing ease of doing business and capital flows
Regulatory simplification, tax certainty, and trust-based compliance.
Measures to improve FDI facilitation, portfolio investment, and global integration.
Launch of an Investment Friendliness Index of States in 2025, aimed at promoting competitive cooperative federalism and encouraging states to strengthen policy frameworks, facilitation mechanisms, and investor responsiveness.
Biopharma
The Union Budget 2026–27 places biopharmaceuticals at the centre of India’s strategy to scale up manufacturing in strategic and frontier sectors. To support the development of India as a global biopharma manufacturing hub, the Budget introduces a comprehensive framework to create an ecosystem, build capacity, and enable clinical research:
1. Biopharma SHAKTI
(Strategy for Healthcare Advancement through Knowledge, Technology & Innovation)
Biopharma SHAKTI aims to develop India as a global biopharma manufacturing hub.
The scheme will be launched with an outlay of ₹10,000 crore over the next five years.
It will focus on building an ecosystem for the domestic production of biologics and biosimilars. The initiative will include the establishment of a biopharma-focused institutional network, comprising three new National Institutes of Pharmaceutical Education and Research (NIPERs) and the upgradation of seven existing institutes.
A network of over 1,000 accredited clinical trial sites will be created to strengthen India's clinical research and development capabilities.
2. Institutional and Talent Capacity Development
Establishment of three new national institutes and upgradation of seven existing institutes to strengthen advanced pharmaceutical education, research, and skills development.
Alignment of academic and research capabilities with industry requirements and global benchmarks.
3. Clinical Research and Regulatory Infrastructure
Creation of a network of 1,000 accredited clinical drug trial sites across the country.
Strengthening of regulatory processes to improve approval timelines and enhance global acceptance of Indian-manufactured biopharma products.
Manufacturing
Through targeted schemes, cluster-based development, and capacity expansion, the Budget aims to create an enabling environment for long-term industrial investment in India. Key initiatives to scale up manufacturing in strategic and frontier sectors include:
Biopharma SHAKTI Scheme
To develop India as a global biopharma manufacturing hub through ecosystem-led capacity creation
India Semiconductor Mission (ISM) 2.0
To expand India’s semiconductor capabilities across equipment, materials, design, and supply-chain resilience, with an enhanced outlay of ₹40,000 crore
Electronics Components Manufacturing Scheme
Outlay to be increased to ₹40,000 crore to deepen domestic value addition and capitalise on rising investment momentum
Rare Earth Corridors
Establishment of dedicated corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu to promote mining, processing, research, and manufacturing of rare earth materials
Chemical Manufacturing Infrastructure
Support for States to establish three dedicated Chemical Parks on a cluster-based, plug-and-play model to strengthen domestic chemical production
Construction and Infrastructure Equipment (CIE)
Introduction of a scheme to enhance domestic manufacturing of high-value and technologically advanced construction and infrastructure equipment
Container Manufacturing
Launch of a dedicated Container Manufacturing Scheme with a budgetary allocation of ₹10,000 crore over five years to build globally competitive capacity
Rejuvenation of Legacy Industrial Clusters
Introduction of a scheme to revive 200 legacy industrial clusters through infrastructure and technology upgradation to improve cost competitiveness and efficiency
Textiles
The Union Budget 2026–27 reaffirms textiles as a priority labour-intensive sector with strong linkages to employment, exports, and regional manufacturing clusters. The Budget adopts an integrated approach to modernise traditional textile ecosystems, strengthen fibre self-reliance, and upgrade skills across the value chain. Key measures for the textile sector include:
Integrated Textile Programme comprising five components:
National Fibre Scheme to support self-reliance in natural, man-made, and new-age fibres
Textile Expansion and Employment Scheme to modernise traditional clusters through capital support for machinery and technology upgradation
National Handloom and Handicraft Programme to integrate and strengthen existing schemes for artisans and weavers
Tex-Eco Initiative to promote globally competitive and sustainable textiles and apparel
Samarth 2.0 to modernise and upgrade the textile skilling ecosystem through industry and academic collaboration
These measures aim to enhance productivity, support value addition, and strengthen India's position in global textile and apparel markets.
Infrastructure
The Union Budget maintains a strong focus on public capital expenditure to support logistics efficiency, urban development, and industrial expansion, thereby crowding in private investment.
Key infrastructure-related initiatives include:
Public capital expenditure of ₹12.2 lakh crore in FY27 to sustain momentum in infrastructure creation
Development of seven High-Speed Rail corridors to strengthen inter-city connectivity and support economic agglomeration across major growth regions.
Expansion of inland water transport through the operationalisation of 20 new National Waterways, improving logistics efficiency and connectivity between industrial clusters, mineral-rich regions, and ports.
Continued focus on infrastructure development in Tier II and Tier III cities with populations exceeding 5 lakh, which have emerged as new growth centres
Development of City Economic Regions (CERs), with an allocation of ₹5,000 crore per region over five years, to unlock agglomeration-led growth and strengthen urban economic clusters through a challenge-based, reform-linked financing model.
Infrastructure-led regional development to support manufacturing clusters, services hubs, and urban economic regions
Champion SMEs and Micro Enterprises
Recognising MSMEs as a critical driver of employment, exports, and supply-chain resilience, the Budget introduces targeted measures to support their scale-up and formalisation.
Key initiatives include:
Creation of Champion SMEs through targeted equity, liquidity, and professional support
Enhanced access to capital and risk finance to support growth-oriented enterprises
Introduced a dedicated ₹10,000 crore SME Growth Fund to create future Champions, incentivising enterprises based on select criteria
A ₹2,000 crore top-up for the Self-Reliant India Fund, set up in 2021, to support micro enterprises and maintain their access to risk capital
Digital Infrastructure and Data Centres
The budget places digital infrastructure at the centre of India’s investment-led growth strategy, recognising data centres and cloud services as critical enablers of the digital economy, artificial intelligence, and next-generation services. The Budget signals long-term policy stability and regulatory certainty, supporting large-scale investments in data storage, processing, and digital service delivery.
Key measures to strengthen digital infrastructure and attract investment include:
Tax holiday till 2047 for data centre operations
Introduction of a long-term tax holiday for foreign companies providing cloud services using data centre infrastructure in India
Intended to provide predictability and investment certainty for hyperscalers, cloud service providers, and digital infrastructure investors
Applicable to data centre operations commencing on or before March 31, 2031
Companies, however, need to provide services to Indian customers through an Indian reseller entity
A safe harbour of 15% on cost to be provided if the company providing data centre services from India is a related entity
Support for large-scale digital infrastructure development
Reinforcement of India’s position as a preferred destination for data centre investments, supported by improving power availability, connectivity, and regulatory frameworks
Alignment with growing demand from digital services, fintech, e-commerce, AI, and global capability centres
Enabling ecosystem for digital and technology-driven services
Strengthening the foundation for high-growth digital sectors, including cloud computing, artificial intelligence, analytics, and platform-based services
Integration of digital infrastructure development with broader initiatives on ease of doing business, tax certainty, and investment facilitation
Education, Skills and Services-Led Growth
The Union Budget 2026–27 reinforces the role of services as a core driver of growth, employment, and exports, supported by targeted institutional and skills-building interventions.
Key initiatives include:
Establishment of a High-Powered ‘Education to Employment and Enterprise’ Standing Committee
Focus on strengthening the services sector to achieve a 10% global share by 2047
Rationalisation of taxation for IT services, including software development services, ITeS, KPO, and contract R&D, under a unified category of Information Technology Services with a common safe harbour framework
AVGC and Creative Economy
The Budget recognises the growing role of the creative economy or the Orange Economy as a source of skilled employment and export potential. Key initiatives include:
Support for the Animation, Visual Effects, Gaming and Comics (AVGC) sector, projected to require 2 million professionals by 2030
Strengthening of creative talent pipelines through the establishment of AVGC Content Creator Labs in 15,000 secondary schools and 500 colleges, supported by the Indian Institute of Creative Technologies, Mumbai
Climate Technologies and Energy Transition
The Budget strengthens India’s commitment to climate action and industrial decarbonisation through targeted support for emerging clean technologies.
Key measures include:
Carbon Capture Utilisation and Storage (CCUS)
Proposed outlay of ₹20,000 crore over the next five years
Focus on scaling CCUS technologies and achieving higher readiness levels across five industrial sectors: power, steel, cement, refineries, and chemicals
These initiatives aim to support India’s long-term energy security while enabling cleaner industrial growth.
Healthcare and Medical Value Tourism
The Budget emphasises strengthening healthcare services and positioning India as a global destination for medical value tourism.
Key initiatives proposed for strengthening the healthcare workforce include:
Expansion of institutions for Allied Health Professionals (AHPs) to address skill gaps across critical disciplines
Coverage of multiple healthcare roles, including diagnostics, clinical support, and behavioural health services
Creation of a stronger talent pipeline to support both domestic healthcare needs and international patient services
Care Economy and Allied Health Services
Development of a structured care ecosystem covering geriatric and allied care services
Introduction of nationally aligned training programmes to support multi-skilled caregivers
Intended to improve service quality, address demographic shifts, and generate employment across healthcare and care services
AYUSH and Traditional Medicine
Strengthening India’s traditional medicine ecosystem
Establishment of new All India Institutes of Ayurveda
Upgradation of AYUSH pharmacies and drug testing laboratories to improve certification and quality standards
Enhancement of research, training, and global outreach for traditional medicine systems
Healthcare Infrastructure and Trauma Care
Expansion of emergency and trauma care capacity through
Establishment of new institutions and upgradation of existing mental health and trauma care facilities
Strengthening district-level healthcare infrastructure to improve access and resilience
Medical Value Tourism Hubs
Support for States to establish five Regional Medical Value Tourism Hubs in partnership with the private sector. These hubs are envisaged as integrated healthcare complexes, combining:
Advanced medical and surgical services
Medical education and research institutions
Diagnostics, post-treatment care, and rehabilitation infrastructure
Dedicated facilitation centres for international patients
Tourism
This year’s Budget has adopted a comprehensive approach to strengthen tourism infrastructure, enhance skills development, and leverage digital platforms to improve visitor experiences and destination management. Key initiatives to strengthen the tourism sector include:
Destination development and experiential tourism
Development of 15 archaeological sites into vibrant, experiential cultural destinations through curated access and immersive interpretation
Promotion of ecologically sustainable tourism, including mountain trails, turtle trails, and bird-watching trails across select regions
Regional and niche tourism promotion
Targeted initiatives to strengthen tourism circuits in emerging destinations, including heritage, spiritual, and nature-based tourism hubs
Alignment of tourism development with regional infrastructure and connectivity initiatives
These measures aim to position tourism as a scalable economic activity that supports job creation, regional development, and investment opportunities across hospitality, transport, digital services and allied sectors.
Tax Reforms
Introduction of a simplified and modernised Income Tax framework, with redesigned rules and forms to reduce compliance complexity and improve ease of filing.
Tax holiday till 2047 for foreign companies providing cloud services using data centre infrastructure in India, aimed at strengthening India’s position as a global data centre and digital services hub.
Measures to reduce litigation and improve trust-based tax administration, including rationalisation of penalties, decriminalisation of minor offences, and integration of assessment and penalty proceedings.
Extension and rationalisation of safe harbour provisions, particularly for Information Technology and IT-enabled services, to provide greater certainty on transfer pricing and tax outcomes.
Targeted tax measures to support manufacturing, services, and export-oriented sectors, including incentives for data centres, cloud services, toll manufacturing, and bonded warehousing.
Reforms to support foreign investment and global mobility, including exemptions and simplified tax treatment for non-resident experts and foreign service providers operating from India.
Rationalisation of customs and indirect tax provisions to support energy transition, critical minerals, electronics manufacturing, and export competitiveness.
Continued emphasis on predictability, transparency, and stability in the tax regime, aimed at improving India’s overall investment climate and long-term investor confidence.
Customs reforms
Simplification of the customs tariff structure to support domestic manufacturing, promote export competitiveness, and correct duty inversion.
Phased removal of long-standing customs duty exemptions on items manufactured domestically or where imports are negligible.
Incorporation of effective rates from customs notifications directly into the tariff schedule to improve transparency and certainty for businesses.
Expansion of duty-free and concessional duty provisions to support export-oriented sectors, including marine products, leather, textiles, electronics, and energy transition technologies.
Enhanced trust-based customs systems, including extended duty deferment periods and greater facilitation for authorised and compliant importers, to enable faster clearance and reduced transaction costs.
Measures to improve customs processes through automation and risk-based assessments, supporting smoother movement of goods across borders and strengthening India’s trade facilitation framework.
Read the full budget speech here: https://www.indiabudget.gov.in/
