As India prepares for the Union Budget of 2025-26, the finance ministry has highlighted the need for flexibility in fiscal policy, given the ongoing global economic and geopolitical challenges. While the fiscal deficit for FY26 is expected to be below 4.5% of GDP, there are concerns over the ability to accurately project receipts and expenditures in the current uncertain environment. The global situation has worsened, with escalating conflicts, further complicating fiscal planning.