Washington D.C. and New Delhi — US-based economists and business leaders have voiced strong support for India's Union Budget 2026-27, calling it a reinforcement of the country's impressive growth trajectory and a positive signal for global trade and investment.
Leading experts including Steve Hanke from Johns Hopkins University have praised India's economic performance under Prime Minister Narendra Modi, though they emphasize that even bolder manufacturing initiatives could help India compete more effectively with China on the global stage.
Key Facts
• India's annual real GDP growth is projected at 6.45 percent between 2025 and 2030, the fastest among major economies, according to International Monetary Fund estimates.
• The Union Budget 2026-27 proposes a nine percent increase in infrastructure investment and a 15 percent increase in defense spending.
• Manufacturing can create hundreds of millions of jobs in India with the right policy framework and more aggressive government support across all sectors.
Steve Hanke, the applied economics professor at Johns Hopkins University, expressed confidence in India's economic direction. He noted that India's strong performance comes as no surprise given the country's trade and growth-oriented policies.
Gunjan Bagla, CEO of Amritt, a US-India consultancy based in Los Angeles, acknowledged that the budget represents an incremental step in the right direction from an international trade and investment perspective. He specifically welcomed the nine percent infrastructure investment increase, saying it would help foreign trade by improving logistics and connectivity over time.
Bagla also praised the 15 percent increase in defense spending, emphasizing that it would enable India's armed services to be more prepared against emerging threats. However, he noted that certain hardware vulnerabilities still remain a concern for India's defense capabilities.
The consensus among US experts is that while the budget's emphasis on manufacturing is positive, it falls short of what Indian factories need to truly compete with China's manufacturing dominance. Bagla stated directly that Indian manufacturers would have benefited significantly from a more aggressive push across all sectors.
Bagla highlighted the remarkable achievement of Indian entrepreneurs over the past two decades, noting that many more could emerge as global players with the right policy framework in place. He emphasized that the global economy needs to recognize and support India not just as a fast-growing market, but as an emerging manufacturing superpower.
The budget announcements have resonated with global business leaders who see India's manufacturing potential as critical to reshaping global supply chains. These measures align with broader international efforts to diversify manufacturing away from single-country dependency and create more resilient production networks.
— Gunjan Bagla, CEO, Amritt
The feedback from US economists and business leaders underscores the importance of India's continued focus on manufacturing as a key driver of employment and economic growth.
International experts will continue monitoring how aggressively India implements these measures and whether additional policy shifts emerge to accelerate manufacturing competitiveness.
Do You Know?
Apple has already begun expanding its smartphone manufacturing operations in India, with export volumes reaching 22. 88 million units in the first half of 2025, up from 15.05 million units a year earlier, demonstrating the growing appeal of India as a manufacturing alternative to China.
Key Terms
• Union Budget: India's annual financial statement detailing government spending, tax policies, and economic priorities for the fiscal year, presented by the Finance Minister.
• Foreign Direct Investment (FDI): Money invested by foreign companies or individuals in India's businesses and manufacturing sectors to establish or expand operations.
• Manufacturing Competitiveness: A country's ability to produce goods efficiently and affordably compared to other nations, helping companies sell products globally at competitive prices.
• Infrastructure Investment: Government spending on roads, ports, railways, and digital networks that support business operations and reduce logistics costs.
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