New Delhi: The Union Budget 2026–27 on Sunday cut allocation for pollution control at a time when the toxic air quality of Delhi-NCR and the Indo-Gangetic Plains has set off alarm bells on an unfolding public health crisis.
The Centre has allocated ₹1,091 crore for pollution control in FY 2026–27, which is ₹209 crore lower than the revised estimates of ₹1,300 crore in 2025-26 that was increased from the allocated ₹853.9 crore that year.
The allocation falls under the Control of Pollution scheme, which funds pollution control boards, committees and the National Clean Air Programme (NCAP), India’s flagship initiative to reduce particulate pollution in non-attainment cities. The NCAP monitors pollution in 82 cities.
The decision triggered sharp criticism from environmental experts. They said the absence of a targeted approach for regions facing the worst pollution was a major gap.
Sunil Dahiya of Envirocatalysts pointed out that the Budget failed to address the regional nature of the crisis. “There is no dedicated allocation for Delhi-NCR or north India, even as air pollution remains a recurring health emergency. Emission reduction at source needs strong policies and financial backing, which are missing,” he said.
Dahiya added that while the overall Control of Pollution head showed a marginal rise, NCAP’s funding across the 82 cities is lower this time than last year’s revised estimates, which is a worrying signal. He also flagged the absence of focused support for EV infrastructure, calling this a “significant miss”.
Anumita Roychowdhury, executive director at Centre for Science and Environment (CSE), aired similar concerns. She said the allocation did not match the scale of the crisis. “The decline in budgetary support has raised doubts about how NCA.0 can be expanded without a commensurate increase in central funding, even if convergence with other sectors is planned,” she said.
Environmental activist Amit Gupta found the budget “deeply disappointing”. “The NCAP allocation was cut by nearly Rs 200 crore. What is even more alarming is that in FY 2024–25, only ₹16 crore was spent against an allocation of Rs 900 crore.”
While the budget boosts clean energy spending, experts argued that this did not translate into a strong anti-air pollution strategy. Aarti Khosla, founder and director of Climate Trends, noted that a record allocation was made for rooftop solar panels, but more could be done.
The Budget has proposed to reduce the tax collected at source (TCS) for self-funded education and medical purposes abroad under the liberalised remittance scheme from 5 per cent to 2 per cent. However, the TCS rate for other purposes will continue at 20 per cent.
Govt had last year exempted remittances for education from TCS where such remittance is from a loan taken from a specified financial institution.
The finance minister has also proposed to reduce TCS on overseas tour packages to 2 per cent. Currently, TCS for such expenditure is levied at a rate of 5 per cent (for remittances up to ₹10 lakh) and 20 per cent (for remittances beyond ₹10 lakh). The move will boost foreign travel.
Under the liberalised remittance scheme, all resident individuals, including minors, are allowed to freely remit up to $250,000 in a financial year without seeking prior approval from RBI. This enables an individual to send money to a child studying overseas for education, make an investment or take a vacation.
Govt’s decision to slash TCS on tour packages to a flat 2 per cent will ease the upfront cash burden for travellers and boost outbound tourism. While TCS is adjustable against a traveller’s final tax liability, it is paid upfront and remains locked with govt for several months, impacting liquidity.
Samco Securities research analyst Jahol Prajapati said the change would lower the entry barrier for high-value travel. “A family had to block an additional amount with govt for months. Now that capital stays in their pocket, effectively reducing the entry barrier for luxury travel,” he said.
Travel companies echoed the sentiment. EaseMyTrip co-founder Rikant Pittie said the TCS cut was among the most significant Budget measures for the sector. MakeMyTrip co-founder Rajesh Magow said the rationalisation directly addresses the liquidity impact faced by Indian outbound travellers. StampMyVisa co-founder Rahul Borude said this could unlock pent-up demand.
SNVA Traveltech chairman Alok K Singh said the TCS cut would “enable better financial planning for travellers and tour operators while supporting responsible and transparent spending.”
