Union Budget 2026 sets record for AI focus as FM Sitharaman mentions tech eleven times

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• AI mentioned 11 times in Union Budget 2026, a record for Indian budget speeches
• AI to enhance governance, agriculture, healthcare, education, and job market analysis
• Tax holiday for foreign cloud firms using Indian data centers until 2047 announced

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Artificial Intelligence emerged as a recurring theme in the Union Budget 2026, with Finance Minister Nirmala Sitharaman referring to the technology a record eleven times in her address -- the highest ever in any Indian budget speech, accoriding to an analysis by The Hindu.

The frequency underlines the government’s intention to position AI as a central pillar in India’s economic and technological transformation.

According to the speech, AI is expected to play a major role in governance, where it will act as a force multiplier for improving the reach and quality of public service delivery.

The technology is also being placed at the heart of efforts to adopt emerging innovations through initiatives such as the AI Mission and the National Quantum Mission.

The finance minister highlighted the use of AI in studying how new technologies reshape employment. Tools powered by artificial intelligence will be used to analyse changing job roles, evolving skill requirements, and labour market trends.

At the same time, AI-enabled platforms are planned to connect workers with suitable jobs and training opportunities.

Several sector-specific applications were outlined. In agriculture, AI will be integrated with AgriStack portals and packages developed by the Indian Council of Agricultural Research (ICAR) to support better farm practices.

In healthcare and accessibility, research and development will focus on incorporating AI into assistive devices for persons with disabilities, including products manufactured by Artificial Limbs Manufacturing Corporation of India (ALIMCO).

Education also features prominently. AI modules are to be embedded directly into the national curriculum from the school level onwards, and teacher training programmes will include components on artificial intelligence.

For professionals, targeted upskilling and reskilling initiatives will be introduced for engineers and technology workers.

Other areas include customs and security, where AI-driven risk assessment will be supported by expanded non-intrusive scanning and advanced imaging systems.

The budget also introduces Bharat-VISTAAR (Virtually Integrated System to Access Agricultural Resources), described as a multilingual AI tool aimed at improving linguistic accessibility across the country.

The 2026 emphasis represents a steady rise in attention over the years. Artificial Intelligence was first referenced in the 2018-19 Budget speech by Arun Jaitley, appearing three times in the context of digital technologies, a national programme, and a mission on cyber-physical systems.

In the 2019-20 Interim Budget, Piyush Goyal mentioned it four times, outlining a national programme, centre, and portal. Sitharaman herself referred to AI once in the 2019-20 Budget, four times in 2020-21, twice in 2021-22, once in 2022-23, four times in 2023-24, and twice in 2025-26.

Beyond policy intent, the government also announced major fiscal incentives for digital infrastructure.

“I propose to provide tax holiday till 2047 to any foreign company that provides cloud services to customers globally by using data centre services from India,” Sitharaman said.

She added, “It will, however, need to provide services to Indian customers through an Indian reseller entity. I also propose to provide a safe harbour of 15% on cost in case the company providing data centre services from India is a related entity.”

Investment in future-ready infrastructure is another recurring theme. Last year, Google announced plans to invest $15 billion over five years in an AI-focused data centre campus in Visakhapatnam, Andhra Pradesh.

The budget also proposes dedicated rare earth corridors in Tamil Nadu, Kerala, Odisha, and Andhra Pradesh to support mining, processing, research, and manufacturing, reducing reliance on imports.

In addition, a Rs 40,000-crore allocation has been proposed for semiconductors under India Semiconductor Mission 2.0, with a focus on developing equipment and materials based on full-stack Indian intellectual property.