As the government prepares Budget 2026 amid persistent global uncertainty and sustained foreign portfolio outflows, market participants are closely monitoring for signals that could revive investor confidence. Gaurav Bhandari, CEO at Monarch Networth Capital, expects the upcoming Budget to be reform-oriented and explicitly FII-friendly, focusing on improving India's attractiveness as an investment destination.

December Quarter Earnings Outlook

Bhandari anticipates decent but not spectacular performance for the December quarter earnings. The following table summarizes his expectations:

While certain pockets like banks and select industrials may show resilience, overall earnings growth will remain moderate on an aggregate basis.

Budget 2026 Reform Expectations

With foreign investors remaining net sellers for much of the past few years, Bhandari believes the government will introduce measures to stem capital outflows and strengthen long-term investor sentiment. He expects a strong reform-oriented budget with specific focus areas:

• Taxation relief for Foreign Institutional Investors
• Enhanced regulatory clarity
• Policy measures to arrest capital flight
• Initiatives to boost India's investment destination appeal

Given sustained FII outflows over the past 3-4 years, he anticipates the government will actively attempt to enhance India's attractiveness as an investment destination.

Currency and Market Dynamics

Regarding the rupee's recent weakness, Bhandari does not foresee depreciation to ₹100 per USD. His currency outlook includes:

He expects the government and RBI to take strong corrective measures, particularly to boost exports and manage currency volatility, with no cause for panic from an investment standpoint.

Sector Preferences and SIP Flow Impact

Bhandari remains positive on specific sectors for medium-to-long-term portfolios:

PSU Banks: Supported by improving balance sheets, better asset quality, and attractive valuations

Defence: Backed by strong order books, indigenization efforts, and sustained government spending

Domestic SIP flows have been a key stabilizing force for Indian equities, and this trend is expected to continue. Financialization of household savings, rising investor awareness, and long-term wealth creation themes should keep SIP inflows robust and consistent, providing a cushion against intermittent foreign selling.

Growth Outlook and Economic Projections

Despite geopolitical concerns and trade tensions, Bhandari estimates the Indian economy should grow in the range of 7.40-7.60% in the current financial year. Domestic consumption will continue to be the backbone of Indian growth, with India's structural strengths, demographic advantage, and policy continuity providing confidence that growth momentum can be sustained despite global uncertainties.

As India approaches Union Budget 2026-27 amid global economic uncertainty, industry leaders across crypto, startup, healthcare, and financial services sectors are unified in their call for policy clarity, regulatory stability, and enhanced focus on technology-driven growth over populist measures.

Crypto Industry Seeks Regulatory Framework

The digital asset ecosystem awaits clear regulatory direction in the upcoming budget. Raj Karkara, COO of ZebPay, emphasised that Budget 2026-27 represents a critical juncture for India's crypto industry, with stakeholders prioritising a consistent regulatory framework to build investor confidence and enable businesses to operate within defined parameters.

Key taxation concerns dominate industry expectations:

Karkara highlighted that clearer policy direction could unlock India's Web3 innovation potential and strengthen the country's position in the global crypto economy, particularly with enhanced AML measures already implemented through FIU registration.

Startup Ecosystem Demands Simplified Compliance

Venture capital leaders acknowledge recent policy initiatives while emphasising execution challenges. Archana Jahagirdar, Founder and Managing Partner at Rukam Capital, noted that measures such as the ₹1 lakh crore RDI Fund and state-level startup policies in Delhi and Karnataka have helped bridge the research-commercialisation gap.

The startup community expects Budget 2026-27 to address several key areas:

• Simplified compliance procedures
• Clearer tax frameworks for startups
• Enabling dual listing mechanisms
• Incentivising domestic capital participation at early stages

Jahagirdar stressed that founders require stability and market access rather than frequent policy changes to convert government intent into sustainable long-term outcomes.

Healthcare Sector Advocates Preventive Care Focus

Healthcare industry leaders are pushing for a structural shift towards preventive care in Budget 2026-27. Lavanya Shastri, Founder & CEO of Adivaa, highlighted that rising lifestyle-related health issues necessitate policy attention beyond traditional hospital and medicine-focused approaches.

The healthcare sector's budget expectations include:

Sajeev Nair, Founder and Chairman of Vieroots, and Masaharu Morita of NURA AI Health Screening Centre support this preventive care approach, arguing that early detection and preventive measures can reduce long-term healthcare costs while easing pressure on tertiary care infrastructure.

Financial Services Focus on Trust and Fiscal Discipline

The BFSI sector emphasises continuity and fiscal responsibility in Budget 2026-27. Ravindra Rai, MD & CEO of BOBCARD Limited, identified sustained emphasis on digital payments, cybersecurity, and secure financial infrastructure as critical for strengthening trust in digital credit adoption.

Rai also advocated for policy support enabling alternative credit assessment models using transaction and cash-flow data to integrate underserved consumers into the formal credit system.

Saurav Ghosh, Co-founder of Jiraaf, highlighted investor focus on fiscal consolidation and deficit guidance. According to Ghosh, a credible pathway towards lower deficits can help maintain stable bond yields and enable corporates to access debt markets with greater confidence.

Industry Consensus on Stability

Across all sectors, the common theme emerging ahead of Union Budget 2026-27 is the preference for policy stability and regulatory clarity over short-term incentives. Industry leaders emphasise that consistent frameworks and technology-focused growth strategies will better serve India's long-term economic interests than populist measures, particularly given the current global economic uncertainties.