‘Emphasis on manufacturing well-placed’

The Budget is another decisive step forward in our journey towards ‘Viksit Bharat’. While addressing pressing economic challenges amidst an uncertain environment, the Budget underscores the government’s commitment to a sustainable and inclusive growth path. The stability and continuity in the reforms agenda are welcome.

Achieving the goal of ‘Viksit Bharat’ requires transformative changes. By prioritising agriculture, manufacturing, MSMEs, exports and ease of doing business—while keeping sustainability and digitisation as underlying themes—the Budget paves the way for continued progress. It strengthens the foundation for a self-reliant economy, fostering innovation and preparing India for the future.

Foremost, the emphasis on manufacturing is well-placed and much appreciated by the industry. The four pillars of Make in India—new processes, new infrastructure, new sectors and a new mindset—have been redefining the country’s manufacturing ecosystem. The Budget reinforces the government’s commitment to further bolster this ecosystem.

The announcement to establish a National Manufacturing Mission by providing policy support, execution roadmaps, governance is looked forward to with anticipation. Additionally, continued support for the MSME sector is welcome. The revised investment and turnover limits for MSME classification, enhanced credit availability with guaranteed cover, and customised credit cards for micro enterprises are notable announcements. FICCI has consistently advocated for scaling up India’s SMEs, and the measures announced in the Budget should encourage small and medium enterprises to expand operations and contribute to overall manufacturing sector growth. Further, specific measures announced for labour-intensive sectors such as footwear, leather, food processing and toys—all of which are dominated by MSMEs—will provide a much-needed boost to employment.

The emphasis on infrastructure development, ease of doing business, skilling and the rationalisation of the customs tariff structure for industrial goods are significant positives that will further enhance the competitiveness of India’s manufacturing sector. We have also noted the announcement to set up a high-level committee on regulatory reforms. The resolve of the government to keep regulations aligned with technological advancements and global developments displays a holistic and forward-looking approach and will help reduce the cost of doing business in the country.

Going beyond manufacturing, the prosperity of the farm sector is equally significant for the nation. Agriculture sector plays an important role in India’s economic framework and requires complete and continuous support for furthering inclusion and ensuring food security. The various announcements made in the Budget geared towards climate-proofing the agriculture sector and emphasising self-reliance are well noted. The National Mission on High-Yielding Crops, along with initiatives for boosting the production of pulses, fruits and vegetables, can help us get a grip on the food inflation problem that has been plaguing the economy for long.

The new Agri Districts Programme, covering 100 districts with low productivity, moderate crop intensity and below-average credit parameters, is another significant step. In our pre-Budget submission to the government, FICCI had recommended an agricultural yield mission for the bottom 100 districts, similar to the Aspirational Districts Programme, and it is encouraging to see this suggestion incorporated into the Budget.

Additionally, the enhancement of the loan limit under the Modified Interest Subvention Scheme from ₹3 lakh to ₹5 lakh for loans taken through the Kisan Credit Card (KCC) will further empower India’s farm community and thereby strengthen rural resilience and financial inclusion.

Importance of sustainability

The Budget also underscores the importance of sustainability as a key economic pillar across sectors. As Prime Minister Narendra Modi often highlights, India must lead the world in creating and adopting green solutions. The emphasis of the National Manufacturing Mission on Clean Tech manufacturing, particularly in solar PV cells, EV batteries, motors and controllers, electrolysers and wind turbines, will move us forward in that direction and reduce our dependence on imports.

Further, the proposed amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act to encourage private sector participation in the Nuclear Energy Mission are encouraging. Transitioning towards a low-carbon growth path is an imperative for long-term sustainability and the nuclear energy sector can make a strong contribution towards this objective.

The government’s strategy of women-led development is yielding visible results. Women-led businesses and self-help groups are transforming the economy at the grass-roots level. A truly progressive nation thrives on gender inclusivity. It is commendable that the Budget continues to support women’s empowerment, particularly through new schemes for first-time entrepreneurs and through a Rural Prosperity and Resilience Programme. However, additional direct interventions in the care economy could have further supported women’s workforce participation and we hope the government would look at this area in the near future.

The announcements in the Budget are expected to spur two key engines of growth—consumption and investment. Changes in the personal income tax structure will give a boost to demand, while the government’s increased capital expenditure, although modest compared to previous years, will continue to add to the nation’s productive capacity. The economic momentum is expected to catch up going ahead.

With robust policy measures, targeted financial support, and forward-looking reforms, the Budget lays a strong foundation for a resilient economic growth.