India’s latest Union Budget speaks the language of climate action. But across heat-scorched cities, flood-hit valleys and shrinking forests, the money tells a more cautious story.
When Nirmala Sitharaman presented Budget 2026, climate change featured prominently in the opening narrative. “Green growth” was positioned as both an economic opportunity and a moral imperative. Yet, as the fine print of allocations reveals, India’s environmental response remains incremental—outpaced by the speed and scale of climate impacts unfolding across states.
The Union Ministry of Environment, Forest and Climate Change (MoEFCC) received just over Rs 3,400 crore this year. In a Union Budget of nearly Rs 50 lakh crore, this translates to less than 0.07 per cent of total expenditure. Analysts at the Centre for Budget and Governance Accountability have pointed out that this proportion has remained largely unchanged for years, even as climate-related losses mount.
In May 2025, temperatures in parts of Rajasthan and Gujarat crossed 48°C. Ahmedabad, often cited as India’s heat action pioneer, activated its Heat Action Plan early, issuing public advisories and adjusting work hours for municipal staff. Yet district officials privately acknowledge that implementation still depends heavily on local capacity and short-term funding.
Despite the growing recognition of heat as a public health emergency, Budget 2026 does not earmark dedicated funds for heat adaptation. Heat Action Plans continue to rely on fragmented financing routed through health or disaster management departments. Research by the Indian Institute of Public Health shows that cities with formal heat plans record fewer heat-related deaths—but only when backed by sustained funding and coordination. The budget remains silent on how this will be ensured nationwide.
If heat is the slow-burning crisis, floods are the recurring shock. In Himachal Pradesh, extreme rainfall events in 2024 and 2025 triggered landslides that wiped out roads, homes and livelihoods. While disaster relief funds were mobilised quickly, long-term investments in watershed management and slope stabilisation remain limited.
Budget 2026 increases allocations for disaster response, but adaptation spending—measures that reduce future risk—continues to be scattered across ministries. According to the Economic Survey, climate shocks could cost India up to 4 per cent of GDP annually by 2030. Yet there is no dedicated national climate adaptation fund, a gap repeatedly highlighted by policy researchers and global climate finance studies.
In Assam, where floods have become an annual certainty, local organisations argue that embankment-centric solutions dominate spending, even as wetlands that naturally absorb floodwaters continue to be encroached upon. Budget documents offer little clarity on shifting this approach.
One area where allocations have risen sharply is pollution control. Funding for pollution abatement, including the National Clean Air Programme (NCAP), crossed Rs 1,300 crore in revised estimates—up significantly from previous years. This reflects political pressure from cities like Delhi, Patna and Kanpur, where air quality routinely reaches hazardous levels.
Data from the Central Pollution Control Board show that over 130 Indian cities exceed national air quality standards. However, environmental experts caution that spending remains skewed towards monitoring stations, mechanised cleaning and short-term fixes. As the Centre for Science and Environment has repeatedly argued, without curbing vehicular growth and industrial emissions, pollution control spending risks becoming an expensive holding operation.
Forests remain central to India’s climate commitments. The country has pledged create an additional carbon sink of up to three billion tonnes of CO2 equivalent through forest and tree cover by 2030. Yet allocations for the Green India Mission remain modest, barely rising in real terms.
In Chhattisgarh and Odisha, where compensatory afforestation projects have expanded rapidly, independent field studies cited by conservation groups such as Kalpavriksh show that monoculture plantations often replace diverse ecosystems. These plantations sequester less carbon over time and provide little livelihood support to forest-dependent communities.
Budget 2026 does not address these concerns. There is no clear articulation of how forest quality, biodiversity and community rights will be balanced against carbon accounting targets.
The budget reiterates support for renewable energy, green hydrogen and domestic solar manufacturing. These announcements align with India’s long-term decarbonisation pathway. However, fossil fuels continue to receive indirect support through tax structures and public investment.
According to analysis by the International Institute for Sustainable Development, India’s fossil fuel support still outweighs direct incentives for renewables. This dual-track approach slows the energy transition and raises questions about the credibility of the “green growth” narrative.
Across sectors, one pattern stands out: those most exposed to climate impacts receive the least targeted support. Tribal communities, small farmers, informal workers and coastal populations contribute little to emissions but face disproportionate risks.
Oxfam India’s recent climate inequality analysis notes that climate finance in India tends to favour capital-intensive projects over community-led resilience. Budget 2026 does little to alter this trajectory. Allocations linked to forest rights, local water management and decentralised adaptation remain weak.
The 2026 budget is not indifferent to the environment. It acknowledges climate risk, strengthens pollution control and supports clean energy innovation. But it stops short of embedding ecological thinking into the core of economic planning.
Global climate economics research, including studies by the London School of Economics, shows that delayed investment in adaptation and ecosystem protection increases long-term fiscal and social costs. India’s budgetary choices suggest that this lesson has been recognised—but not yet acted upon at scale.
For a country confronting intensifying heat, floods and ecological stress, incrementalism may no longer suffice. Future budgets will need to treat the environment not as a sector, but as foundational infrastructure—critical to public health, food security and economic stability.
Until then, India’s budgets will continue to speak green, while the ground beneath grows increasingly fragile.
Sagari Gupta is a public policy researcher with over eight years of experience in social development, governance reforms, and data-driven policy analysis in India.
Views expressed are the author’s own and don’t necessarily reflect those of Down To Earth