New Delhi [India], January 12 (ANI): Senior Congress leader Jairam Ramesh on Monday raised concerns about the upcoming Union Budget, warning that state governments and the broader economy are entering a critical phase as Parliament prepares for its next session.

In a post on X following the announcement of the parliamentary schedule, Ramesh noted that the Union Budget for the 2026-27 fiscal year will be presented in approximately 20 days. He said the budget will inevitably reflect the recommendations of the 16th Finance Commission, which submitted its report on November 17, 2025.

'These recommendations cover the period from 2026/27 to 2031/32 and pertain to the sharing of tax revenue between the Centre and the states, as well as the distribution of this revenue among the states,' Ramesh said.

https://x.com/Jairam_Ramesh/status/2010570821530706385

Highlighting growing unease among state governments, the Congress leader pointed to the new cost-sharing formula in the VB-G RAM G Act, 2025. He said states are 'already deeply concerned by the 60:40 cost-sharing formula introduced in the new law that bulldozes MGNREGA out of existence,' adding that they would now be 'sitting with fingers crossed in even greater apprehension' as the budget approaches.

Ramesh also outlined what he described as three major challenges confronting the Indian economy. According to him, private corporate investment remains sluggish despite tax cuts and strong profit margins; domestic savings rates have declined sharply, constraining investment capacity; and inequalities in wealth, income, and consumption continue to widen.

'The economy is facing several challenges,' he said, adding that these issues threaten the sustainability of growth and employment generation.

Questioning the government's approach, Ramesh said it remains to be seen whether the forthcoming budget moves beyond what he called 'the comforting confines of statistical illusions' to acknowledge economic realities and take meaningful corrective steps.

He cautioned that high GDP growth rates, which are crucial for large-scale job creation, cannot be sustained unless these structural challenges are addressed urgently in the upcoming budget. (ANI)