Budget 2026 technology initiatives expectation: Semiconductors, IndiaAI expansion, and AI push

India's Finance Minister, Nirmala Sitharaman, is poised to unveil the Union Budget for 2026 on Sunday, February 1, 2026. This year’s budget is set to emphasize significant allocations and fresh initiatives aimed at advancing the financial landscape for 2026-27, with a particular spotlight on technology as a catalyst for realizing India's vision of a 'Viksit Bharat'. With Artificial Intelligence (AI) increasingly influencing the stock market dynamics, there’s a palpable sense of optimism among investors, tech companies, and the broader technology sector regarding potential government support and initiatives. The upcoming budget is expected to concentrate on several key areas, including AI, semiconductor production, data centers, and deep-tech startups. One of the central themes anticipated in Budget 2026 is the enhancement of the IndiaAI Mission. Reports suggest that the government may propose increased funding to develop a robust data center infrastructure, potentially involving 18,000 to 30,000 GPUs, which would significantly benefit domestic startups. Additionally, we could see the establishment of new national AI centers aimed at advancing education and healthcare sectors. The electronics and semiconductor industry is also expected to receive a boost, with potential announcements regarding support for existing manufacturing initiatives, including those focused on fabrication and packaging. Furthermore, there may be duty waivers on essential minerals such as lithium and cobalt, which are crucial for chip manufacturing machinery. The Design Linked Incentive (DLI) scheme might also witness enhanced support to further promote innovation. According to a MoneyControl report, India is gearing up to attract substantial global investments into its AI ecosystem. A senior government official highlighted the country's vast potential for investors, citing the $15 billion investment commitment from Google for its AI hub, which includes a data center and fiber-optic network in Andhra Pradesh, as a significant milestone achieved in 2025.