The Government of India is going to present its budget in the Parliament on 1 February 2026. Generally, there is a tradition of presenting the roadmap for farmers, employees, income tax slabs and economic development in the Union Budget of India. What is in the Finance Minister’s budget box this year will be revealed on February 1. Then the economists of the country will analyze the budget in their own way.
Come, let us try to understand on the basis of our budget, on which areas the budget of major countries of the world focuses. We will also know who are the top five budget countries in the world?
United States: defense, security and the debt trap
The total federal budget (expenditure) for the year 2025 was approximately $7.3 trillion dollars. America’s budget is the largest in the world, but a large part of it goes to mandatory spending (Social Security and Medicare). The biggest challenge for America in 2025 has been rising interest payments, which are now reaching the level of their defense budget. America spends a large part of its budget on defense. Meaning, its main focus is to strengthen military power.In this way three things became his priority. Social Security, Medicare and Defense.
The priorities of the US defense budget include countering the growing threat of China in the Indo-Pacific region, modernizing nuclear weapons, increasing cyber warfare capabilities and developing long-range missiles. The US has allocated $25 billion on an ambitious project called Golden Dome, which is to strengthen the missile defense system. America’s view is that world peace can be achieved through military power.
Lesson for India: When debt increases, less money is left for development works. India will have to keep an eye on its ‘debt-to-GDP’ ratio.
China: infrastructure, self-reliance and technological war preparations
China has the second largest budget in the world. Its total central expenditure in the year 2025 was approximately 28.5 trillion yuan i.e. four trillion dollars. China’s budget is based on self-reliance and preparation for technological war. In the year 2025, his entire emphasis has been on New Quality Productive Forces (AI, Chips, Green Energy). China is giving a large part of its budget directly to industries for subsidy and research. So that it can overtake America. China’s budget priorities also include infrastructure development, expansion of transportation networks, water resources management, energy security, and technological innovation.
In the year 2025, China has made a record in terms of trade surplus.
China is particularly investing in artificial intelligence, quantum technology, and space technology. China’s view is that economic growth can be accelerated by increasing domestic consumption. Therefore, China is also increasing investment in social sectors like healthcare, education, and elderly care. China aims to achieve an economic growth rate of 4.8 percent in the period 2026-2030.
Lesson for India: Schemes like PLI need to be implemented more accurately and on a large scale so that a place in the global supply chain can be secured.
A large part of Japan’s budget is also spent on social security.
Japan: Fighting on two fronts, increased defense budget
Japan’s budget is being fought on two fronts. On one side, rapidly aging population (Social Security) and on the other side, regional security (Defense). Japan has made a record increase in its defense budget in the year 2025, which is a big change in their pacifist history. Last year, the total central budget of Japan was 116 trillion Japanese yen i.e. 770 billion dollars. Japan’s defense budget has crossed almost nine trillion yen for the first time. Japan is investing in drone technology, long-range missiles, and coastal defense systems.
This investment is being made due to the increasing military threat of China. But a large part of Japan’s budget is also spent on social security. Japan’s population is aging rapidly, so spending on healthcare and pensions is increasing. 39 trillion yen has been allocated for social security. 25 percent of Japan’s budget goes on debt repayment, which reflects the country’s financial challenges.
Lesson for India: It is difficult to strike a balance between defense and social security. India will have to take advantage of its young population and create sustainable models of pension and health from now on.
A significant increase in defense expenditure is being seen in Germany’s budget.
Germany: focus on defense and European security
Germany’s total federal expenditure in the year 2025 will be approximately 489 billion euros i.e. approximately 530 billion dollars. Germany’s budget is an example of ‘fiscal discipline’. He is against taking too much loan. In the year 2025, their main focus has been on modernizing their army again due to energy transition and Ukraine war. Germany is the country with the largest economy in Europe.
A significant increase in defense expenditure is being seen in Germany’s budget. Germany has increased its defense budget to provide aid to Ukraine and meet NATO commitments. Germany’s budget priorities include military aid to Ukraine, security of NATO member states, and strengthening European security. Meanwhile, Germany has also cut the aid given to developing countries. This decision shows that European countries are prioritizing their own security and cutting global development aid.
Lesson for India: Keeping fiscal deficit low is important to attract investment.
The United Kingdom spends more money on health and defense sectors.
United Kingdom: balancing healthcare and defence
The total government expenditure of the United Kingdom in the year 2025 was approximately 1.2 trillion euros i.e. 1.5 trillion dollars. The UK budget is a struggle to save the public service. The National Health Service (NHS) there is absorbing a huge part of the budget. And it is estimated that it will increase continuously for the next few years. Now his aim is to improve public services by increasing taxes and accelerate development through investment.
UK Budget priorities include an additional £29 billion investment in the NHS, a £10 billion investment in digital health services, expanding mental health services and improving dental services. The UK has also increased defense spending, but has given greater priority to healthcare. Development aid has also been cut in the UK budget, indicating that developed countries are focusing on their internal needs.
Lesson for India: Just spending money is not enough, the delivery and efficiency of services (like DBT and digital infra in India) decide the success of the budget.
Hints for India’s February 1 budget
It is clear from the budgets of the top 5 countries of the world that different countries have different priorities. The US and Japan are emphasizing defence, China on infrastructure and technological innovation, Germany on European security, and the UK on healthcare. The lesson for India is that the budget should not be limited to farmers and tax issues only. India should also make balanced investments in its defense capability, infrastructure, healthcare, and education. India should provide a roadmap for development in all these areas.
Also read: How many months does it take to prepare the budget, what is the secret blue sheet?