Budget 2026-27: Four Key Ministries That Shape Jobs, Health and Education in India

New Delhi: Going by the allocations announced by finance minister Nirmala Sitharaman in Budget 2026-27, India is running to stay where it is. Across employment-intensive sectors such as agriculture and textiles and core services like health and education, the latest budget shows little reform or push for meanigful expansion in capacity or productivity. Instead, for the most part, the funding seen in FY 2024-25 is only restored by the latest numbers – two years down the line.

Ministry of agriculture

Actual expenditure on agriculture in 2024-25 was Rs 1,29,933 crore, while budget 2026-27 allocates Rs 1,30,561 crore. That is a gross increase of only around Rs 628 crore – a 0.5% nominal growth, marked over two full years.

Once inflation is factored in, the 2026-27 spending will effectively remain flat or lower in real terms compared to 2024-25. In other words, the budget for agriculture is barely crawling back to levels seen two years ago, not rising meaningfully.

This is almost certainly a real-term decline once inflation will be factored in.

Core farm spending

Core spending is down and there is a pullback in direct farmer income. The flagship PM-KISAN scheme and the key crop insurance scheme have both been cut back. The allocation for PM-KISAN is down from Rs 66,121 crore to Rs 63,500 crore, an over Rs 2,600 crore cut over two years, though unchanged from the previous year.

Crop insurance (PMFBY) allocation is also down, from Rs 14,473 crore to Rs 12,200 crore, another Rs 2,200-plus cut over two years – and a Rs 200 crore cut over the last budget.

There are increases in funding for items within the agriculture ministry, but they are targeted and relatively small compared to the big cuts. For instance, total capital outlay is up from Rs 75 crore to Rs 110 crore, a 46% hike, but tiny in absolute terms.

The Rs 5,600 hike in the Krishionnati Yojana (it provides extension services, seeds, soil health, mechanisation, plant protection and so on), a significant addition, along with the symbolic capital outlay hike, make for a total increase in state-level schemes for 2026-27 to Rs 7,748 crore.

Agriculture research

The actual expenditure in 2024-25 on agricultural research, which was about Rs 9,811 crore in 2024-25, has been elevated to just over Rs 9,967 crore in 2026-27, or by about Rs 156 crore over two years. That is a 1.6% nominal growth, again implying a real-term decline.

Altogether, agricultural research and development stands cut by Rs 519 crore. The budget of premier agriculture research body ICAR has been cut by Rs 94 crore for 2026-27. But central agricultural universities have been given an additional Rs 132 crore .

There is a strong indication that money is being moved around within the sector rather than being added.

Where is the expansion from?

Relative to the revised estimates in FY 2025-26, the 2026-27 budget does expand agriculture expenditure. However, most of the increases are primarily due to the earlier mentioned Krishionnati Yojana. PM-AASHA is also up from Rs 6,941 to Rs 7,200 crore, an increase of roughly Rs 560 crore in a year and about Rs 1,763 crore since 2024-25.

Also read: Budget Expectations: Need to Escape Confused Policy Making

But elsewhere, there is either stagnancy or cuts: PM-KISAN is flat at Rs 63,500 crore, crop Insurance (PMFBY) is slightly cut and crop husbandry has made a marginal recovery from Rs 75,387 to Rs 76,387 crore (but still below 2024-25 levels).

Why this matters: Agriculture

Agriculture supports around around 15 crore farming households in India, accounting for livelihoods of roughly 50 crore people (close to 45% of the workforce), even though the sector contributes only about 15% of national GDP. In other words, a small share of the national income supports a big section of the population, which is why agriculture is politically sensitive, quite apart from the fact that food is produced on farms, as is raw material for many industrial sectors.

The average monthly income of an agricultural household is estimated at about Rs 10,000-12,000, derived from cultivation, livestock, wages and non-farm activities. This figure is what the small and marginal farmers – who constitute more than 85% of holdings – make in India.

It is for this reason that the government had found massive support for its direct income support schemes such as PM-KISAN, which were meant to provide Rs 6,000 per year per farmer (below a threshold of land holding and income). It is an income stabiliser, though still a small share of annual farmer household earnings.

Ministry of Health

Unlike agriculture, health shows a clear nominal expansion in budget 2026-27 – but largely in terms of the headline numbers. Compared with FY 2025-26 (Revised Estimates), health spending has increased by about Rs 8,800 crore. Compared with FY 2024-25 actuals, the increase is about Rs 14,400 crore.

The National Health Mission allocation has gone up from about Rs 37,100 crore to Rs 39,390 crore in the latest budget – after a dip in actual expenditure last year. Overall, Centrally Sponsored Schemes have risen from about Rs 50,468 crore to Rs 55,305 crore, an addition of roughly Rs 4,800 crore.

The Ayushman Bharat PMJAY allocation has been increased from about Rs 9,000 crore to Rs 9,500 crore, a modest increase of just over Rs 500 crore over a year and of just over Rs 2,000 crore over two years. Similarly, the National Health Mission increases from about Rs 37,100 crore to Rs 39,390 crore, adding around Rs 2,300 crore – a correction after a dip in actuals over the last financial year.

Capital spending allocation also recovers in 2026-27 after dipping in the RE year, especially in medical and public health infrastructure.

Also read: Many Budget Announcements From Last Year Remain Unimplemented or Partially Operationalised: Report

However, even with the overall increases, the allocation for the Family Welfare department within the ministry of health remains below its 2024-25 level. Some central schemes fluctuate or stay flat rather than rise steadily.

Allocation for the department of family welfare within the ministry is also subdued, at about Rs 1,525 crore, still below its FY 2024-25 level and only marginally higher than the RE.

Health research

The Department of Health Research remains a very small component of public spending, even in the current Budget. Net expenditure has risen from about Rs 3,384 crore in 2024-25 (actual) to Rs 3,928 crore in 2025-26 (Revised Estimate) and then to Rs 4,821 crore in 2026-27 (Budget Estimate).

In absolute terms, this is an increase of roughly Rs 1,440 crore over two years, and about Rs 890 crore over the RE year, very modest for India’s size and disease burden.

Most of this increase is concentrated in grants to the Indian Council of Medical Research (ICMR), which move from about Rs 3,150 crore in 2025-26 to Rs 4,000 crore in 2026-27. While this looks significant within the department, it still leaves India’s premier public health research body operating at a scale that is small relative to national needs and international comparators.

Why this matters: Health

Public health spending matters because health outcomes directly shape labour productivity, household savings and inequality. Even modest illnesses push lakhs of Indians into debt each year, while weak primary and preventive care raises long-term fiscal and social costs.

Ministry of textiles

The Ministry of Textiles budget does not show a steady expansion – the allocations are well below what would be expected for a sector positioned as a mass employment engine that faces global headwinds as well as local (regional) competition.

Allocations grew for the sector from about Rs 2,938 crore in 2024-25 (actual) to Rs 5,767 crore in 2025-26 (Revised Estimates). This falls back in the latest budget to about Rs 5,279 crore. Spending might increase as the year goes on, but this makes the current budget a partial pullback from the RE year.

Also read: What Earlier Budgets Say About Job Creation by the Modi Government

The flagship initiatives such as the allocation for Performance-Linked Incentive scheme (PLI) for textiles is roughly flat at about Rs 405 crore, far below its initial peak of Rs 1,148 crore in 2025-26 (Budget Estimate), which then dropped to Rs 400 crore in 2025-26 (Revised Estimate).

PM-MITRA – a scheme to set up large, integrated textile parks – has been restored to Rs 300 crore after a dip to Rs 200 crore in the revised estimates for the previous year.

Why this matters: Textiles

Textiles matter because they are among India’s most labour-intensive manufacturing sectors and one of the few with the potential to absorb workers leaving agriculture, particularly women and semi-skilled workers. As global supply chains diversify and competition from countries like Vietnam and Bangladesh intensifies, policy and fiscal support is critical, but virtually absent.

Ministry of education

Most big heads in school education had cuts or slowdowns in 2025-26 and the 2026-27 budget simply brings them back to where they were supposed to be. Samagra Shiksha, PM-POSHAN and PM-SHRI all flagship schemes, show this dip-and-rebound trend.

The Department of School Education and Literacy budget has been increased to about Rs 83,562 crore in 2026-27 (Budget Estimate). This is a net rise of roughly Rs 18,400 crore over two years and of about Rs 13,000 crore over the previous financial year.

Samagra Shiksha, the largest programme under the ministry, falls in the RE year (from about Rs 41,250 crore to about Rs 38,000 crore) and then rebounds to about Rs 42,100 crore in 2026-27. Again, this only brings it back to its earlier trajectory rather than breaking new ground.

PM-POSHAN follows a slightly different pattern, rising from Rs 10,600 crore in the RE year to Rs 12,750 crore. (Its actual expenditure in 2024-25 was Rs 9,903 crore.)

However, the allocation is still modest considering the scale of the malnutrition crisis in India.

Higher education

On higher education, the spending has risen but a signal that meaninfgul change is underway is not to be seen or heard. The net expenditure increased from about Rs 45,576 crore in 2024-25 (actual) to Rs 51,382 crore in 2025-26 (RE) and Rs 55,727 crore in 2026-27 (BE).

This is a gain of roughly Rs 10,150 crore over two years – and just about Rs 4,000 crore over the previous year. Most of this hike goes to central institutions like central universities, IITs, NITs and IIEST.

Research-related spending increases from a very low base, with allocations rising to about Rs 418 crore, very marginal relative to the overall higher education outlay.

Why this matters: Education

Education spending matters for long-term productivity and India’s ability to convert its demographic profile into economic gain, especially as learning outcomes come under pressure and malnutrition, dropouts and skill mismatches rise.

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