Budget 2026‑27 shifts to capex‑driven growth – The government targets a fiscal deficit of 4.3 % of GDP and public capital expenditure of ₹12.2 lakh crore, framing infrastructure and MSME support as structural rather than temporary stimulus. This marks a move from pandemic‑era crisis management to a borrowing‑heavy financing model. The Finance Minister presents these figures as the backbone of a “Viksit Bharat” vision. [1]
Capex share of total spending more than doubled – Since 2020‑21, capital expenditure rose from about 12 % to over 22 % of total fiscal outlays, turning capex into the organising principle of fiscal policy. The increase coincides with record infrastructure spending but masks a disconnect with labour creation. [1]
Youth NEET rate stalls around one‑quarter – The share of 15‑29‑year‑olds not in education, employment or training remains at 23‑25 %, far higher than peer economies, indicating that expanding public investment has not reduced structural joblessness. [1]
Construction’s employment elasticity fell sharply – Elasticity dropped from 0.59 in 2011‑12‑2019‑20 to 0.42 in 2021‑22‑2023‑24, meaning each additional rupee of capex now generates fewer construction jobs despite record spending. [1]
Agriculture’s employment elasticity surged – Elasticity rose from 0.04 in the pre‑COVID period to 1.51 in 2021‑22‑2023‑24, suggesting workers are falling back into low‑productivity farming rather than moving to higher‑value sectors. [1]
Growth model creates a dual economy – Capital‑intensive large firms drive headline GDP while small, labour‑intensive MSMEs remain marginal, leading to a split between a profit‑focused upper layer and a vast informal, low‑productivity lower layer that absorbs most workers. Wage growth stays subdued even in the organised sector. [1]