Finance Minister Nirmala Sitharaman presented the Union Budget 2026-27 today, delivering a capex-heavy yet fiscally disciplined roadmap that reinforces infrastructure as the principal engine of growth while accelerating India’s push towards technological self-reliance and enterprise formalisation.
With gross capital expenditure maintained at ₹12.2 lakh crore (an 8.8% increase over the previous year) and the fiscal deficit targeted at 4.3% of GDP, the budget balances prudence with ambition in a volatile global environment. Key announcements include the launch of India Semiconductor Mission 2.0, enhanced support for electronics component manufacturing, rare earth corridors, a ₹10,000 crore SME Growth Fund, revival of legacy industrial clusters, integration of GeM with TReDS, and the introduction of Corporate Mitras for MSME compliance support in Tier-II and Tier-III cities.
Industry leaders have broadly welcomed the budget as forward-looking, non-inflationary, and execution-oriented, though some have called for sharper focus on resolving structural frictions to unlock the next phase of value creation.
MSME Sector: Liquidity, Equity and Hinterland Growth
The budget’s flagship intervention for small and medium enterprises — the ₹10,000 crore SME Growth Fund coupled with liquidity reforms, cluster revival, and compliance assistance — has been described as a transformative shift from survival to scale.
Amit Kumar, Director and CTO of Easebuzz, highlighted the holistic approach:
“The Government’s 2026 Union Budget prioritises strengthening the MSME ecosystem with measures for liquidity, institutional support and the formalisation of the sector. A ₹10,000 Crore SME Growth Fund will enable MSMEs to expand their operations, improve efficiencies and remain competitive, while nearly 200 legacy industrial clusters will be revived so that traditional manufacturing regions can be revitalised from credit and technology constraints. The integration of the Government e-Marketplace with the Trade Receivables Discounting System (TReDS) is designed to resolve long-standing issues related to delayed payments by improving the visibility of accounts receivable and increasing cash flows to SMEs. The top-up to the Self-Reliant India Fund will provide additional equity support for micro and emerging enterprises, in addition to the credit-based support measures. Liquidity and credit guarantee support, as well as the introduction of corporate mitras to assist MSMEs in meeting compliance and other operational needs, demonstrate a holistic approach to enterprise development. In the digital and fintech sectors, these reforms represent the increasing importance of having transparent and technology-enabled transaction infrastructure to promote MSME resilience, formalisation and sustainable growth.”
Sanjay Agarwal, Founder, MD & CEO, AU Small Finance Bank, termed it a defining moment for hinterland entrepreneurship:
“Union Budget 2026-27 sends a powerful signal of consistency and confidence. By adhering to capex-heavy fiscal consolidation with gross fiscal deficit at 4.3% in FY27, the government has anchored the economy in prudence, ensuring stability even as it pushes for growth. The proposed high-level banking committee is a strategic masterstroke, promising a roadmap that balances credit expansion with consumer protection and technological agility. For the MSME sector, this is a transformative moment. The ₹10,000-crore SME Growth Fund shifts the focus from mere survival to the creation of ‘Enterprise Champions’. Furthermore, the introduction of ‘Corporate Mitras’ in Tier II and Tier III cities is revolutionary, ensuring that the next wave of growth comes from the hinterland, not just from the metros. We welcome the reduction of customs duties on inputs/capital goods, emphasis on AI adoption, continuation of structural reforms, and ease of doing business. The budget is forward-looking, growth-positive, and non-inflationary.”
Technology & Deep-Tech: Semiconductors, AI and Hardware Momentum
The budget doubles down on frontier technologies with ISM 2.0, rare earth corridors, industry-driven R&D, and continued support for the National Quantum Mission.
Kulpreet Sahni, Founder & CEO, Chiltier, underscored the shift to full-stack innovation:
“The Budget’s emphasis on semiconductors, rare earth corridors, and industry-driven R&D is a big positive for the hardware and deep tech ecosystem in India. For climate tech and advanced wearables, the ability to tap into domestic components, power electronics, and materials is essential to developing robust and affordable solutions at scale. The emphasis on skills and research centers is equally important. Hardware innovation drives high-quality employment opportunities in design, engineering, and manufacturing, and positions India favorably in the world’s supply chains. This is a great way to encourage founders working on applied technologies with practical applications, and to help India move from assembly to full-stack innovation.”
Arijeet Talapatra, CEO, itel India, welcomed the localisation push:
“The Union Budget 2026 delivers a clear and reassuring message for brands investing in India’s electronics ecosystem, laying a strong framework towards establishing India as a global hub for manufacturing electronics. The increased outlay of the Electronics Component Manufacturing Scheme will help deepen localisation, strengthen the value chains, and improve the cost competitiveness of consumer electronics goods. The announcement of the India Semiconductor Mission 2.0 is a welcome move that will bolster India’s journey towards becoming Atmanirbhar — critical for ensuring uninterrupted access to crucial technologies. The government’s focus on infrastructure development in Tier-2 and Tier-3 cities will further drive consumer-led growth by improving access, distribution efficiency, and last-mile connectivity. For itel, these initiatives resonate deeply with our commitment of democratizing access to durable, reliable, and affordable technology — empowering millions of consumers across Bharat.”
Dr. Rashida Vapiwala, Founder and CEO, LabelBlind, pointed to AI and deep-tech synergies:
“The Finance Minister’s focus on emerging technologies such as AI as growth drivers sends a positive and timely message for India’s startup and MSME ecosystem. By placing innovation at the centre of economic growth, the Budget highlights the role of startups in helping MSMEs become globally competitive. The proposed ₹10,000 crore fund for small and medium enterprises is an important step, as it will support high-potential SMEs in scaling operations, adopting new technologies, and building long-term strength, creating the champions of tomorrow. Initiatives like the National Quantum Mission further reflect the government’s long-term approach to strengthening deep-tech capabilities and future-ready infrastructure.”
Infrastructure & Sustainability: Urban-Industrial and Green Push
The sustained capex momentum and targeted climate initiatives have been lauded for aligning growth with environmental goals.
Gaurav Bali, Co-founder & CEO, Enlite Research, noted the demand-side implications:
“Budget 2026 has allocated ₹12.2 trillion to infrastructure development, marking a 8.8% rise from the previous year. This is a clear indication of the focus on developing urban and industrial areas. The government has also allocated ₹20,000 crore for carbon capture and climate initiatives. Such budget allocations will lead to a rise in demand for energy-efficient buildings and smart infrastructure solutions. Technology integration in building management can help track energy consumption, lower carbon emissions, and manage costs effectively. The emphasis on sustainability and technology integration is in line with the country’s climate goals. The budget offers a planned approach to achieving growth and sustainability.”
Deepak Verma, Head of Business, Pacecourt, appreciated the long-term sports infrastructure vision:
“The Khelo India Mission, now extended for a further 10 years, is a much-needed initiative that understands sports as a long-term national infrastructure and not merely an activity that takes place through events. As India readies itself for a long-term sports infrastructure build-out in schools, developments, and public spaces, and as it prepares for the Commonwealth Games in the next decade, the need to shift the focus from short-term build-out to the long-term design of these infrastructure assets is essential. Long-term, standardized, and climate-resilient sports surfaces are critical to ensuring that public investments are channeled into sports infrastructure that remains safe, playable, and functional over a period of high usage. The success of this mission will not only be measured by the number of courts constructed but also by the quality of these courts that can withstand the test of time.”
Dhaval Radia, Chief Financial Officer (India), ZEISS Group, offered a nuanced perspective on competitiveness:
“Union Budget 2026 reinforces stability at a time when global uncertainty remains elevated. The government’s continued focus on capital expenditure, infrastructure & logistics, tech-driven compliance and fiscal discipline provides an important foundation for medium-term growth and investor confidence. That said, India’s next phase of value creation will increasingly depend not just on public spending alone, but on the competitiveness of its operating environment. For advanced manufacturing and healthcare technology companies, challenges today lie in structural frictions such as customs complexity, inverted duty structures, regulatory overlaps, and interpretational tax uncertainty. As India aspires to move up the value chain – from scale to sophistication – future policy frameworks will need to place greater emphasis on predictability, simplification, and governance. This shift will be critical for attracting long-term investments, accelerating innovation, and positioning India as a global hub for precision manufacturing and technology-led growth.”
The Union Budget 2026-27 presents a coherent strategy of fiscal stability, enterprise empowerment, technological sovereignty, and sustainable infrastructure development. While public capex continues to lead, industry voices stress that unlocking the next wave of private investment and global competitiveness will require swift implementation and deeper structural reforms in the months ahead.
Last Updated on: Wednesday, February 4, 2026 10:48 pm by BUSINESS SAGA TEAM | Published by: BUSINESS SAGA TEAM on Wednesday, February 4, 2026 10:48 pm | News Categories: India News
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