Sitharaman proposed a comprehensive review of the Foreign Exchange Management (Non-Debt Instruments) Rules...

Union Minister of Finance and Corporate Affairs Nirmala Sitharaman on Sunday presented the Union Budget 2026–27 in the Lok Sabha.

The Budget proposes the establishment of a ‘High-Level Committee on Banking for Viksit Bharat,’ according to a press release from the Finance Ministry.

The Finance Minister said the committee will comprehensively review the financial sector and align it with India’s next phase of growth, while safeguarding financial stability, promoting inclusion, and ensuring consumer protection.

The Union Budget noted that the Indian banking sector today is characterised by strong balance sheets, historic highs in profitability, improved asset quality, and coverage exceeding 98% of villages in the country.

The Budget also proposes restructuring the Power Finance Corporation and Rural Electrification Corporation to achieve greater scale and improve efficiency in public sector NBFCs. The vision for NBFCs in Viksit Bharat has been outlined with clear targets for credit disbursement and technology adoption.

Sitharaman proposed a comprehensive review of the Foreign Exchange Management (Non-Debt Instruments) Rules to create a more contemporary, user-friendly framework for foreign investments, consistent with India’s evolving economic priorities.

To strengthen the corporate bond market, the Budget proposes a market-making framework with suitable access to funds and derivatives on corporate bond indices, along with a proposal for total return swaps on corporate bonds.

To encourage issuance of higher-value municipal bonds by large cities, the Budget proposes an incentive of Rs 100 crore for a single bond issuance of over Rs 1,000 crore. The current scheme under AMRUT, which incentivises issuances up to Rs 200 crore, will continue to support smaller and medium towns.

To enhance ease of doing business, Individuals Persons Resident Outside India (PROI) will be permitted to invest in equity instruments of listed Indian companies through the Portfolio Investment Scheme. The Budget also proposes to increase the investment limit for an individual PROI under this scheme from 5% to 10%, with the overall investment limit for all individual PROIs increased from 10% to 24%.