India’s benchmark equity indices tumbled on Sunday afternoon after the Union Budget proposed a steep increase in the Securities Transaction Tax (STT) on commodity futures, triggering a broad-based sell-off across sectors.
Even as markets reacted negatively, industry leaders and experts welcomed Budget 2026, calling it growth-oriented, balanced and focused on long-term reforms rather than short-term market triggers.
The 30-share BSE Sensex plunged 2,370.36 points, or 2.88 per cent, slipping below the psychologically crucial 80,000 level to trade at 79,899.42 in afternoon trade. The 50-share NSE Nifty mirrored the fall, tanking 748.9 points, or 2.95 per cent, to 24,571.75.
Industry representatives said the market reaction was driven by immediate concerns over the STT hike and profit-booking, and did not reflect the broader intent of the Budget.
Sanjay Mehta, deputy director general of IMC Chamber of Commerce, called the Budget “very positive and forward-looking”, noting that it covered both traditional sectors and emerging technologies. At the same time, he played down any direct link between the Budget and the market fall.
“I do not see any correlation between the market and the Budget. There is nothing in the Budget that should prompt the market to react as it is now,” Mehta said.
Echoing similar views, Sheetal Kalro, deputy director general of IMC Chamber of Commerce and Industry, described the Budget as “extremely balanced”, highlighting fiscal prudence and targeted investments.
She pointed out that the government has maintained, and marginally reduced, the fiscal deficit, while directing investments towards artificial intelligence, digitalisation, decarbonisation, sustainability, infrastructure and healthcare.
“The tax slab has been maintained. They have given tax rebates in other aspects. It may not be personal income tax, but relief has been extended for medicine, housing loans and entrepreneurship. If you look at it in a balanced way, tax exemptions have been provided in the right areas,” Kalro said.
Healthcare leaders also welcomed the Budget’s emphasis on disease management, research and long-term health infrastructure.
Dr Naresh Trehan, chairman and managing director of Medanta, said that while India has made significant progress in eliminating communicable diseases, the burden of non-communicable diseases continues to rise.
“Cancer, diabetes and obesity are increasing rapidly. Developing biologics and biosimilars requires significant research and investment, and this has been incentivised in the Budget,” Trehan said, adding that the focus would strengthen India’s healthcare ecosystem over the long term.
Industry bodies, including the Confederation of Indian Industry (CII), reacted positively to measures aimed at supporting MSMEs, boosting capital expenditure and simplifying the tax framework.
CII president Rajiv Memani said these steps would help sustain growth momentum amid global uncertainties.
Meanwhile, Associated Chambers of Commerce and Industry of India Jammu and Kashmir chairman Manik Batra said public expectations had been high following recent GST reforms and free trade agreements with the UK and the European Union.
“While there was anticipation around tax relief, the Budget has taken a broader approach by focusing on structural economic measures that will yield results over time,” Batra said.
Dr Sahitya Chaturvedi of the Ajmal Group described the Budget as a “Viksit Budget”, citing its emphasis on rural development, banking reforms, MSMEs, and advancements in education and healthcare.
“This is a growth-oriented Budget that not only addresses immediate priorities for 2026 but also lays out a mid-term roadmap for the next three to five years, paving the way for a Viksit Bharat by 2047,” Chaturvedi said.
Experts from the manufacturing and technology sectors welcomed the government’s push towards self-reliance.
The increased outlay for the electronics components manufacturing scheme, raised to Rs 40,000 crore, was seen as a key step towards reducing import dependence and strengthening domestic production.
JSA Partner Rishabh Gupta said the move would accelerate semiconductor development, create jobs and deepen India’s integration into global value chains, with positive spillovers for artificial intelligence and other emerging technologies.
“It will promote initiatives such as Make in India, Atmanirbhar Bharat and the PLI schemes. Semiconductors are a critical element for hardware, and from a compute perspective, this will support the development of stronger AI models,” Gupta said.
Placing the Budget in a global context, Siddharth Balachandran, chairman of the Indian Business and Professional Council, said India’s economic trajectory makes the Budget relevant beyond its borders.
“As India sets the tone for global growth, the Indian Budget becomes relevant not only for Indians but for the world. The IMF has said India will be the growth engine of the world for many years, and that brings both responsibility and accountability,” Balachandran said.