The Union Budget for FY26 provides the perfect booster shot for an Aatmanirbhar and Viksit Bharat through inclusive development and strategic investments. The finance minister’s focus on fuelling consumer demand, strengthening micro, small, and medium enterprise (MSME) participation in the digital economy, accelerating the technology ecosystem, and simplifying regulatory frameworks to enhance the ease of doing business is commendable.
Tailwinds for consumer demand, market growth
The income tax relief for the middle class and simplifying tax compliance for both individuals and businesses reflect a strong commitment to “sabka saath, sabka vikas, sabka vishwas, and sabka prayas” — a collective effort for inclusive growth. More money in the hands of the common man should create a feel-good effect in the economy and trigger consumption. From an e-commerce/retail perspective, this presents an opportunity for companies to continue to invest in premium and discretionary categories.
Support to MSMEs and women entrepreneurs
MSMEs are the backbone of our industrial base, with the micro sector accounting for over 99% of the total estimated number, more than half of which originates from tier-II regions and beyond. The Budget recognises the importance of MSMEs and their role in the government’s Make in India programme.
Doubling the credit guarantee cover to Rs 10 crore for micro and small enterprises will improve access to funds and help these entities scale up. This includes creating opportunities to leverage new digital technologies and for them to be a part of the growing digital ecosystem.
The Budget is also inclusive in ensuring the participation of women and marginalised sections in the workforce. Provision of term loans of up to Rs 2 crore for 5 lakh women, those from Scheduled Castes and Scheduled Tribes, and first-time entrepreneurs addresses their much-needed funding requirements.
Reducing basic customs duty on several inputs, particularly those in textiles and electronics — both sectors in which India holds a significant manufacturing base — will also enable MSMEs to expand their capacities and grow their businesses.
Regulatory and compliance ease
The proposal to set up a high-level committee to review all non-financial sector regulations, certifications, licences, and permissions is a big pro-business move to make India an even more attractive market to invest in. Giving individuals and institutions more time for compliance is a step forward in making the tax framework friendly.
Focus on technology and building capabilities
India boasts a vibrant start-up ecosystem, and adequate funding is crucial for its continued growth. The Budget addresses this need with a new Fund of Funds, with expanded scope and a fresh contribution of another Rs 10,000 crore from the government. This should spur our budding entrepreneurs to make bolder bets. The Deep Tech Fund of Funds will catalyse the next league of start-ups specialising in advanced technological sectors, including artificial intelligence (AI), robotics, blockchain, and clean energy.
In addition, the Budget’s Rs 500-crore allocation to set up a Centre of Excellence in AI for education, including agriculture, health, and sustainable cities, underscores India’s ambition to play a leading role in the global sweepstakes.
The Budget has taken several measures to improve skilling, capacity building, entrepreneurship, and employment opportunities for the youth, with initiatives like driving employment in the tourism and manufacturing sectors. Overall, the Budget is testimony to the government’s commitment to stimulating growth and innovation while providing an impetus to the common man’s spending power. It lays a solid foundation for a self-reliant and prosperous India.
The writer is CEO, Flipkart.
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