Calls for Jharkhand’s Inclusion in Rare Earth Strategy
Mail News Service
Jamshedpur: Noted economist Prabal K. Sen, retired Professor of Economics and Founder-Chairperson of the Entrepreneurship Development Centre (EDC) at XLRI – Xavier School of Management, Jamshedpur, described the Union Budget 2026-27 as forward-looking, with a clear emphasis on economic growth anchored in social justice.
He is also a former BOB Chair Professor at the Institute of Rural Management Anand (IRMA), Gujarat, and currently serves as a Member of the Board of Governors, Management Development Institute (MDI), Gurgaon.
Sen observed that from a micro-economic perspective, the most critical requirement for sustaining growth is fiscal consolidation, and in this regard the budget has made a credible attempt.
The government’s decision to peg the fiscal deficit at 4.3 per cent of GDP was, he said, a commendable exercise—particularly at a time when global economies are grappling with heightened geopolitical turbulence and uncertainty.
However, he also sounded a note of caution, expressing doubts over the government’s ability to maintain the fiscal deficit at the projected level.
He pointed out that capital account receipts may fall short of expectations. While the government has projected capital receipts of nearly Rs 12 lakh crore, the disinvestment target of Rs 80,000 crore appears difficult to achieve, with no visible momentum so far.
This, he noted, could put pressure on fiscal arithmetic as the year progresses.
On the growth front, the former XLRI professor highlighted the ambitious Bio-Pharma SHAKTI mission, backed by an outlay of Rs 10,000 crore, as a significant push towards innovation-led growth.
The proposal to establish three new pharmaceutical research institutions is particularly encouraging, as it could facilitate the development of new drug molecules and strengthen India’s position in advanced healthcare research.
The budget’s focus on rare earth permanent magnets also drew attention. The government has proposed support for mining, processing, research and manufacturing in mineral-rich states such as Odisha, Kerala, Andhra Pradesh and Tamil Nadu. Dr Sen felt that Jharkhand, given its mineral wealth, deserved inclusion in this strategic initiative.
Welcoming the proposal to develop 200 legacy industrial clusters, he expressed hope that the auto-components and accessories sector, which is vital to Jharkhand’s industrial ecosystem, would find representation. He also noted that the Rs 10,000 crore outlay for MSME growth could significantly benefit Jharkhand, where many small and medium enterprises have shown resilience and competitiveness.
Among other notable measures, the economist praised the introduction of Corporate Mitras in Tier-II and Tier-III cities, where professional chartered accounting institutions will mentor enterprises, and the creation of an Infrastructure Risk Guarantee Fund, calling it a “remarkable” step to crowd-in private investment.
In the sustainability domain, the allocation of Rs 20,000 crore for Carbon Capture, Utilisation and Storage (CCUS) across five industrial sectors—power, cement, steel, refineries and chemicals—was described as timely and forward-thinking.
Sen also welcomed initiatives in banking reforms, education-to-employment linkages, the Orange Economy for graphics and design, SHE-Marts for rural women entrepreneurs, and Bharat VISTAR, an AI-based platform aimed at reducing agricultural risks.
Measures supporting coconut, cashew and sandalwood farmers further reinforced the budget’s inclusive development narrative.
Overall, he summed up the budget as visionary in intent, cautious in execution, and one that will ultimately be judged by the realism of its revenue assumptions and the effectiveness of its implementation.
