Union Budget 2026–27: Employment, Inequality And The Future Of Work In India

Press Release
Priyanka Choubey
Avni Singhai

The IMPRI Center for Work and Welfare (CWW), IMPRI Impact and Policy Research Institute, New Delhi, hosted an interactive panel discussion on “Employment, Livelihoods, and Union Budget 2026-27” on February 3, 2026 (Tuesday) at 6:30 p.m. IST under IMPRI’s 7th Annual Series of Thematic Deliberations and Analysis of Union Budget 2026-27.

The Chair & Moderator of the session, Prof Suchita Krishnaprasad, Visiting Professor, IMPRI; Former Associate Professor and Head of the Dept of Economics, Elphinstone College, Mumbai provided key insights into the budget, highlighting India’s strong macroeconomic performance, noting GDP growth of around 7%, a fiscal deficit of 4.3%, and a debt-to-GDP ratio of 55.6%, positioning India as the world’s fourth-largest economy amid global uncertainty. She pointed to encouraging trends such as revival of consumption, rising labour force participation, declining unemployment, and moderation in food inflation, especially significant after the sharp pandemic-induced contraction.

However, she cautioned that persistent trade deficits in goods, inadequate offset through services exports, and continued dependence on foreign capital inflows have kept the rupee under pressure. Drawing on the Economic Survey’s concept of a “strategic power gap,” she highlighted how geopolitical positioning influences currency stability, even in the presence of sound macroeconomic fundamentals. Reflecting on post-pandemic budgets, she noted a consistent policy focus on boosting physical infrastructure and public capital expenditure as a central strategy for growth.

Growth, Inequality, and Structural Weaknesses of the Budget

Prof Praveen Jha, Professor, Economics; Chairperson, Centre for Economic Studies and Planning (CESP), School of Social Sciences, Jawaharlal Nehru University, New Delhi, India. Speaking on the Union Budget 2026-27, he offered a critical assessment by situating the budget within India’s broader macroeconomic context. He noted that public responses range from viewing the budget as a modest, status-quo exercise to dismissing it as a flat, evasive document that avoids India’s pressing economic challenges. Drawing attention to persistent doubts over GDP estimates raised by mainstream economists and institutions, he highlighted worrying indicators such as stagnant consumption, declining savings, rising inequality, muted rural wages, and underperforming investment trends.

Professor Jha argued that weak resource mobilization, driven by tax cuts, fiscal conservatism, and poor revenue growth, has rendered the budget largely ineffective. He criticized the reliance on vague visions and platitudes over concrete policy action, particularly in manufacturing, MSMEs, agriculture, and employment. While acknowledging the infrastructure push through public capital expenditure, he concluded that the budget lacks seriousness, scale, and clarity to address India’s structural economic concerns.

Migration, Informal Work, and Demographic Transitions Migration

Prof S Irudaya Rajan, Chair, International Institute for Migration and Development, India critically reflected on India’s demographic and labour policies by linking the Budget with key chapters of the Economic Survey. He highlighted the continued reliance on outdated population projections based on the 2011 Census, arguing that drastic changes in fertility, mortality due to COVID-19, and intensified migration demand require updated demographic data. Professor Rajan raised serious concerns about large-scale student migration, describing it as “brain waste” rather than brain circulation, as many skilled Indians abroad are forced into unskilled work and face de-skilling.

He also emphasized the need for a clear return-migration policy, as many students are likely to come back due to restrictive immigration regimes. Drawing attention to India’s rapidly ageing population, especially in southern states, he called for recognizing senior citizens as assets through the concept of a “silver demographic dividend.” He further stressed fair and legal migration frameworks and urgent digital literacy initiatives for the elderly to ensure inclusive development where no one is left behind.

Education, Skills, and Employment Linkages

Prof Randhir Singh Rathore, State Project Director, Haryana State Higher Education Council, Dean of Academic Affairs at Shri Vishwakarma Skill University, Haryana, the first Government Skill University established by the Government of Haryana. He played a pivotal role at the All-India Council Highlights Education–Livelihood Linkages in the Union Budget 2026-27

Speaking on the education sector during a discussion on the Union Budget 2026-27, Professor Randhir Singh analyzed the budget through three key lenses: accessibility, quality, and relevance of education, and its connection to livelihood opportunities. He noted that while India has achieved near-universal enrollment at the primary level, higher education enrollment remains low at around 28-29 percent, far from the target of 50 percent by 2035.

Professor Singh welcomed the budget’s emphasis on expanding educational infrastructure, including the proposal for five university townships, regional medical hubs, new institutions in pharmaceuticals, design, allied health, veterinary sciences, and hospitality. He argued that such investments could significantly improve access while strengthening research and skill development ecosystems.

On quality, he highlighted continued support for assessment frameworks in school education and increased funding for higher education schemes such as PM-USHA, PM-SETU for ITI upgradation, and PM Research Chairs, aimed at strengthening technical education and research capacity.

He further emphasized that the budget’s push in sectors like biopharma, semiconductors, AI, textiles, transport infrastructure, and manufacturing could revive STEM education enrollment by aligning education with emerging employment opportunities, making education more relevant to India’s future workforce needs.

Working Population, Informality, and Climate Vulnerability

Mr Sandeep Chachra, Executive Director, ActionAid Association, India and Ex Co-Chair, World Urban Campaign, UN-HABITAT; Advisor, IMPRI, presented a critical analysis from the perspective of India’s working population, highlighting deep structural failures in the government’s economic approach. He emphasized that the budget must be seen as a continuation of previous budgets that have collectively intensified distress among workers across rural and urban India.

Citing PLFS 2023-24 data, Mr. Chachra noted that a majority of India’s workforce remains trapped in low-income, informal, and insecure employment, with nearly three-fourths earning below ₹15,000 per month. He stressed that the budget offers no credible pathway for employment generation, instead promoting capital-intensive growth that has failed to create jobs despite massive increases in capital expenditure.

Mr. Chachra expressed concern over the rapid expansion of precarious gig work, declining support for MSMEs, and stagnant welfare allocations that merely ensure survival rather than dignity. He further criticized the budget’s silence on climate change, pointing out the absence of provisions for climate-induced job loss, displacement, health impacts, and livelihood destruction.

Concluding, he argued that the budget reflects a corporate-centric vision, neglecting caste, class, gender, and climate realities, and fails to uphold the constitutional responsibility towards India’s working people.

Labour Rights, Welfare State, and Workers’ Insecurity

Ms Amarjeet Kaur, General Secretary, All-India Trade Union Congress, criticizes Union Budget for Abandoning Welfare Commitments, sharply criticized the government for moving away from its constitutional responsibility as a welfare state. She stated that while the budget is being projected as a “long-term” and “visionary” document, it completely ignores the realities of workers and farmers, who form the backbone of the Indian economy.

Ms. Kaur pointed out that despite grand announcements on smart cities, corridors, digital missions, and infrastructure, there is little progress on the ground. She highlighted the growing insecurity of India’s labour force, especially informal, contract, and daily wage workers, noting that the budget makes no serious provision for employment generation or job security. She also expressed concern over rising migration and the increasing exodus of young people in search of work.

Criticizing the government’s emphasis on “ease of doing business” and global investor confidence, Ms. Kaur said this reflects a clear shift away from welfare-oriented governance. She cited examples such as reduced allocations for basic services like drinking water and education, and the closure of government schools, as evidence of this retreat. Concluding, she said the budget prioritizes corporate interests over people’s needs and fails to address the crisis faced by the majority of India’s population.

Conclusion

The panel discussion underscored that while the Union Budget 2026-27 projects macroeconomic stability and infrastructure-led growth, it falls short in addressing India’s deeper structural challenges related to employment, livelihoods, inequality, migration, education–work linkages, and the climate crisis. Speakers collectively highlighted concerns over weak job creation, persistent informality, rising precarity of work, inadequate welfare commitments, outdated demographic and migration policies, and the lack of a people-centric and climate-responsive approach. Despite some positive steps in education and public investment, the deliberations concluded that the budget lacks the scale, clarity, and inclusiveness required to secure dignified livelihoods and sustainable development for India’s working population.