Manufacturing leaders want sustained support through PLI schemes, MSME credit access, infrastructure investment and execution-focused reforms to strengthen competitiveness, scale and resilience.
Equity market participants will track whether Budget 2026-27 prioritises higher capex, consumption support or a blend of both, along with relief for export sectors impacted by US tariffs and employment-focused outlays.
Industry expectations span domestic demand stimulation, GST rationalisation, infrastructure-led growth, skilling, and sector-specific reforms, particularly in energy and consumer durables, to anchor the next manufacturing growth cycle.
As the Union Budget 2026-27 approaches, India’s manufacturing sector finds itself at a critical inflection point, with industry leaders emphasising that policy continuity, effective execution and domestic demand stimulation will be key to shaping the next phase of growth.
Across capital goods, consumer durables, infrastructure, energy, electronics and MSMEs, there is broad consensus that while headline budgetary allocations remain important, the real impact will hinge on reforms that enhance competitiveness, resilience and scale. Industry stakeholders are seeking measures that deepen India’s manufacturing base while strengthening its integration into global value chains.
Positioning manufacturing as the backbone of the government’s developmental vision, Anil G. Verma, Executive Director and CEO of Godrej Enterprises Group, underscored the need for sustained policy support through Production-Linked Incentive (PLI) schemes, the National Manufacturing Mission and improved access to credit for MSMEs. He also highlighted the importance of logistics modernisation, adoption of Industry 4.0 technologies and large-scale skilling initiatives.
Infrastructure-led growth continues to be a central expectation from the upcoming union budget. Deepak Shetty, CEO and Managing Director of JCB India, emphasised the multiplier effect of infrastructure investment and called for its continued prioritisation. He advocated enhanced funding support for states to accelerate rural road development and water infrastructure projects. Strengthening export competitiveness, Shetty added, would require WTO-compliant incentive frameworks and more effective utilisation of India’s free trade agreements.
On the consumption front, Madhav Mani, CEO of Usha International, noted a steady recovery in the consumer durables segment, driven by demand for energy-efficient, technology-led products and rising adoption across Tier 2 and Tier 3 markets. He said further rationalisation of the Goods and Services Tax (GST) could play a pivotal role in unlocking sustained consumption growth.
From an equity markets perspective, investors are expected to closely track Budget measures aimed at supporting growth. Naval Kagalwala, COO and Head of Products at Shriram Wealth Ltd, said market participants would be watching whether growth support is channelled through higher capital expenditure, which has long-term multiplier effects, or through measures to boost consumption, or a combination of both. He added that support for export-oriented sectors impacted by US tariffs, along with initiatives to boost manufacturing and employment such as increased outlays for PLI schemes, would be key areas of focus for markets.
Energy sector participants are calling for deeper structural reforms. Dr Kapil Garg, Founder and Managing Director of Oilmax Energy, flagged the higher GST burden on oilfield services and urged the inclusion of petroleum products under the GST framework. He also called for infrastructure status for the sector and access to dedicated financing to boost domestic exploration and reduce import dependence.
As expectations build ahead of the Budget, manufacturing leaders and market participants alike are aligned in their view that targeted reforms, rather than headline spending alone, will determine whether India’s manufacturing ambitions translate into durable, broad-based growth.
