Budget 2026 related to the environment and climate change

India’s Minister for Finance, Ms Nirmala Sitharaman, presented the Union Budget 2026-2027 in Parliament today. This was her ninth consecutive budget.

The Union Budget of India is the country’s annual financial plan, outlining the government’s expected revenues and planned expenditures, prepared by the Ministry of Finance.

The Finance Minister, in her speech, said that this budget is inspired by 3 Kartavya (responsibilities):

First kartavya is to accelerate and sustain economic growth by enhancing productivity and competitiveness and building resilience to volatile global dynamics.
Second kartavya is to fulfil the aspirations of people and build their capacity, making them strong partners in India’s path to prosperity
Third kartavya, aligned with the vision of Sabka Sath, Sabka Vikas (development for everyone), is to ensure that every family, community, region, and sector has access to resources, amenities, and opportunities for meaningful participation.

Presenting the Budget, the Finance Minister said, India will continue to take confident steps towards Viksit Bharat (Developed India), balancing ambition with inclusion.

As in previous years, Change Started has compiled all major environmental and climate-related initiatives announced in Budget 2026. From connectivity to tourism, the budget has proposed key environmental initiatives across sectors.

Environmental initiatives in Budget 2026

Sustainable Connectivity

To promote environmentally sustainable movement of cargo, the Finance Minister proposed new Dedicated Freight Corridors connecting Dankuni in the East to Surat in the West.

In Budget 2026, she also mentioned operationalising 20 new National Waterways (NWs) over the next 5 years, starting with NW-5 in Odisha, to connect mineral-rich areas of Talcher and Angul and industrial centres like Kalinga Nagar to the Ports of Paradeep and Dhamra.

Furthermore, to promote environmentally sustainable passenger systems, seven High-Speed Rail corridors between cities will be developed as ‘growth connectors’, namely i) Mumbai-Pune, ii) Pune-Hyderabad, iii) Hyderabad-Bengaluru, iv) Hyderabad-Chennai, v) Chennai-Bengaluru, vi) Delhi-Varanasi, vii) Varanasi-Siliguri.

Carbon Capture Utilisation and Storage (CCUS)

In December 2025, India’s Department of Science and Technology (DST) launched a comprehensive R&D Roadmap for Carbon Capture, Utilisation, and Storage (CCUS) to accelerate net-zero targets.

Aligning with the roadmap, Budget 2026 emphasised that CCUS technologies at scale will achieve higher readiness in end-use applications across five industrial sectors, including power, steel, cement, refineries, and chemicals.

An outlay of ₹20,000 crore is proposed in Budget 2026 over the next 5 years.

DST has taken a leadership role in supporting translational R&D by creating CCU testbeds in real industrial environments and leveraging innovative public–private partnership models.

Sustainable Textiles

The Budget 2026–27 has laid strong emphasis on the labour-intensive textile sector, recognising its critical role in employment generation, exports, rural livelihoods and sustainable manufacturing.

To enhance competitiveness, self-reliance and employment, the Government has proposed an Integrated Programme for the Textile Sector with the five sub-components, including one on the Tex-Eco Initiative.

The Tex-Eco Initiative aims to promote globally competitive, environmentally sustainable textiles and apparel manufacturing, aligning the Indian textile industry with international sustainability standards and emerging green market opportunities.

Additionally, to strengthen khadi, handloom and handicrafts, the Mahatma Gandhi Gram Swaraj Initiative will be launched. The initiative will focus on global market linkage, branding, streamlined training, skilling, quality improvement and process modernisation.

Agroforestry and Agriculture

Clan Earth's Tree Planting

To diversify farm output, increase productivity, enhance farmers’ incomes, and create new employment opportunities, the Budget 2026 proposed developing crops such as coconut, agar trees, sandalwood, cocoa, and cashew in our coastal areas.

Coconut: The minister said India is the world’s largest producer of coconuts. About 30 million people, including nearly 10 million farmers, depend on coconuts for their livelihood.

To further enhance competitiveness in coconut production, the budget proposes a Coconut Promotion Scheme to increase production and enhance productivity through interventions, including replacing old, nonproductive trees with new saplings/plants/varieties in major coconut-growing states.

Cashew and cocoa: A dedicated programme is proposed for Indian cashew and cocoa to make the country self-reliant in its production and processing, and enhance export competitiveness. The Budget 2026 aims to transform Indian Cashew and Indian Cocoa into premium global brands by 2030.

Sandalwood: This tree is closely linked to India’s social and cultural heritage. To promote this tree, the government will partner with States to promote focused cultivation and post-harvest processing to restore the glory of the Indian Sandalwood ecosystem.

Walnuts, almonds, and pine nuts: To rejuvenate old, low-yielding orchards and expand high-density cultivation of these crops, the government also plans to support a dedicated programme to enhance farmer incomes and add value by engaging youth.

Furthermore, the government has announced a six-year mission to develop climate-resilient pulses (tur, urad, and masoor) seeds to enhance agricultural sustainability.

Nature-based Tourism

The finance minister noted that India has the potential to offer world-class trekking and hiking experiences. In this regard, the Budget proposed developing ecologically sustainable mountain, turtle trails and bird trails.

The proposed mountain trails are in Himachal Pradesh, Uttarakhand, and Jammu and Kashmir; in the Araku Valley of the Eastern Ghats; and on Podhigai Malai in the Western Ghats.

The turtle trails are proposed along key nesting sites in the coastal areas of Odisha, Karnataka, and Kerala, and bird-watching trails along Pulikat Lake in Andhra Pradesh and Tamil Nadu.

These nature-based tourism initiatives will not only raise citizens’ awareness of the protection of nature and wildlife, but also foster a sense of pride and ownership in the natural landscape and its rich biodiversity.

The Budget 2026 also notes the formation of the International Big Cat Alliance in 2024, which aims for the conservation of seven big cats – Tiger, Lion, Leopard, Snow Leopard, Cheetah, Jaguar and Puma.

This year, India is hosting the first-ever Global Big Cat Summit, where heads of government and ministers from 95 range countries will deliberate on collective conservation strategies.

Energy Transition and Security

In a major step towards green mobility, the Budget 2026 proposes to extend the basic customs duty exemption for capital goods used for manufacturing lithium-ion cells for batteries to those used for manufacturing battery energy storage systems.

With respect to encouraging solar panel development in India, the government propose to exempt basic customs duty on the import of sodium antimonate for use in the manufacture of solar glass.

To augment India’s nuclear power ambitions, the budget plans to extend the existing basic customs duty exemption on imports of goods required for Nuclear Power Projects until 2035 and expand it to all nuclear plants, irrespective of capacity.

Under the proposed rare-Earth corridors, the budget proposes dedicated corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu to promote sustainable mining and manufacturing of rare-earth elements. This aims to reduce dependence on imports.

The financial budget allocations include Rs 32,915 crore for the Ministry of New and Renewable Energy, Rs 29,997 crore for the Ministry of Power, and Rs 24,124 crore for the Department of Atomic Energy.