In the Union Budget 2026–27, presented by Finance Minister Nirmala Sitharaman, India’s MSMEs, entrepreneurs and startups were placed firmly at the centre of the country’s growth strategy. Moving beyond short-term relief, the Budget signalled a structural shift, one that recognises small businesses not as peripheral contributors, but as core engines of productivity, innovation and employment in India’s journey towards a Viksit Bharat.
For MSMEs, the Budget acknowledged a long-standing challenge, access to growth capital. The proposed Rs 10,000 crore SME Growth Fund signalled a move beyond survival financing toward scale financing. By combining equity support with performance-based incentives, the government aimed to help promising enterprises transition into “Champion MSMEs” capable of competing in national and global markets.
Liquidity, a persistent concern for small businesses, received a structural solution rather than a temporary fix. Strengthening the TReDS platform, mandating its use by CPSEs, and enabling invoice-backed securities reflected an understanding of cash-flow realities faced by entrepreneurs. For many founders, this marked a shift from dependence on traditional credit to a more market-linked, technology-driven financing ecosystem.
The Budget also addressed the less visible, but equally critical, pain point of compliance. By introducing Corporate Mitras, trained para-professionals to assist MSMEs with regulatory and financial requirements, the government acknowledged that time and complexity often cost entrepreneurs more than capital. This move was especially relevant for enterprises in Tier II and Tier III cities, where access to professional support remains limited.
Startups found encouragement in the Budget’s broader emphasis on innovation-led growth. From manufacturing-linked schemes and cluster-based industrial parks to AI-enabled public platforms, the policy environment aimed to create demand for startup-led solutions across sectors. Entrepreneurs working in supply chains, agritech, FinTech, logistics, and deep tech stood to benefit from this expanding opportunity landscape.
Importantly, the Budget did not separate entrepreneurship from inclusion. Women-led enterprises were given a clear pathway to scale through SHE-Marts, building on the success of the Lakhpati Didi programme. Rural and micro-entrepreneurs were brought into the formal economy through improved market access, skilling, and financing tools, turning livelihoods into enterprises.
What set Budget 2026–27 apart was its tone. It did not promise instant outcomes. Instead, it focused on ecosystems, capital, credit, skills, markets, and trust, working together to support enterprise growth.
For India’s MSMEs and startups, this Budget was less about announcements and more about alignment. Alignment between ambition and execution. Between policy intent and business reality.
And in that alignment lies the confidence that small businesses are no longer at the margins of India’s growth story.
They are at its core.
Business perspective from Leaders:
Dr. Vikram Kumar, Founder & Managing Director, SRV Media, said, “Union Budget 2026 goes beyond allocations to architect ecosystems – linking education, healthcare, creativity, and industry at scale. From university townships and regional medical hubs to content creator labs and design institutes, the focus is clearly on future skills and employability. For brands and institutions, this marks a shift from transactional communication to purpose-led narratives rooted in impact and innovation. As policy enables new talent pipelines and digital-first learning, strategic communication will be critical in building credibility, attracting stakeholders, and translating policy vision into measurable public trust and growth.”
Mohal Lalbhai, Founder & Group CEO, Matter Motor, said, “The Union Budget 2026 reinforces the Government’s long-term focus on strengthening India’s advanced manufacturing ecosystem, even as direct EV-specific incentives remain measured. The emphasis on strategic manufacturing, India Semiconductor Mission 2.0, and high-precision engineering underlines a clear shift towards capability-led growth over short-term subsidies. For electric mobility, this is critical. Future competitiveness will be driven by power electronics, battery management systems, motor technologies, intelligent vehicle platforms, innovation in alternate materials, and Advanced Integrated Drivetrain Vehicles (AIDV). The Budget’s focus on critical minerals, rare earth processing, and component ecosystems supports resilient, India-based supply chains for next-generation EV powertrains. At MATTER, built on deep in-house engineering and integrated manufacturing, this policy direction aligns strongly with our approach, enabling Indian EV companies to compete globally on performance, innovation, and export readiness in line with the Innovate in India, Make in India, Make for the World vision.”
Rajnikant Behera, Executive Director, Aftermarket and Corporate Governance, RSB Group, said, “The Union Budget 2026 lays out a strong, infrastructure-led growth roadmap for India’s manufacturing economy, with ‘Creating and Championing MSMEs’ identified as one of the six key pillars. The continued emphasis on infrastructure development will play a critical role in strengthening industrial logistics, construction, and mobility-linked manufacturing segments, directly benefiting capital goods and automotive supply chains. The focus on rejuvenating legacy industrial sectors and developing city economic regions, particularly in emerging geographies, will help disperse manufacturing growth beyond traditional hubs and unlock new demand centres. Measures aimed at improving access to finance, cluster development, and capital support for MSMEs will further reinforce the manufacturing ecosystem across value chains. Importantly, the emphasis on consumption-led growth will be vital for sustaining demand in the automotive sector. Collectively, these interventions create a stable and forward-looking environment for automotive component manufacturers to invest in capacity, deepen supply chains, and strengthen India’s long-term manufacturing competitiveness. The parallel push on semiconductors, electronics manufacturing, and advanced engineering further reinforces India’s ambition to build a resilient, future-ready industrial ecosystem aligned with the vision of ‘Make in India, Make for the World’.”
Nitin Jain, Founder, IVYN, said, “The government’s proposal to revive 2,000 industry clusters, create a Rs 10,000 crore MSME growth fund, and establish mega textile parks is a strong signal of long-term commitment to India’s manufacturing backbone. These measures will not only strengthen MSMEs but also modernise the textile and garment ecosystem, enabling scale, innovation, and global competitiveness. At IVYN, we strongly believe that Indian textiles and garments are poised to become a dominant global force over the next decade. With supportive policies, infrastructure-led growth, and increasing foreign alignments, the sector is well-positioned to excel on the world stage.”
Rachit Soota, Founder, RYZ, said,”Reviving 2,000 textile clusters and introducing a Rs 10,000 crore MSME growth fund is a big moment for India’s textile story. As the founder of a next-gen activewear brand, I see this as an opportunity to empower the backbone of our industry, our MSMEs, our manufacturers, and the skilled artisans who make world-class products possible. Mega textile parks with modern infrastructure can truly change the game by enabling scale, innovation, and sustainable production. If implemented well, this can help Indian brands like RYZ compete globally while proudly building in India, for the world. ”
Dr. Rashida Vapiwala, Founder and CEO, LabelBlind, said, “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 Rs 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. As India opens up new trade opportunities through FTAs, AI-led regulatory compliance will be critical for Indian food companies to meet global standards and compete internationally. For LabelBlind, these measures reinforce our commitment to AI-led solutions, innovation, and building scalable platforms that support a resilient and inclusive digital economy.”
Arijeet Talapatra, CEO, itel India, said,”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.”
Anurag Jain, CEO & Co-founder, ORISERVE, said, “The government’s renewed focus on AI and emerging technologies signals a clear intent to move India from technology adoption to technology leadership. Strengthening national missions around AI, deep-tech R&D, and innovation creates a strong foundation for building scalable and responsible digital systems. For the FinTech ecosystem, continued policy backing for the AI Mission and R&D funding will accelerate intelligent solutions that improve efficiency and financial inclusion. Initiatives like Bharat Vistaar emphasize the importance of multilingual, AI-led platforms in widening access. This approach is especially relevant for financial services, where trust, personalisation, and reach are critical.”
Anand Chandra, Co-founder & Executive Director, Arya.ag, said, “Bharat-VISTAAR brings the promise of making agri-advisory more intelligent, timely, and accessible at the farmgate. By integrating AI with AgriStack and ICAR advisories in multiple languages, it can support better decisions on crops, inputs, and markets, especially for smallholder and first-generation women farmers. The Rural Women-Led Enterprises initiative, building on the Lakhpati Didi programme, takes this further by enabling the shift from subsistence livelihoods to ownership. In our experience, such enterprises succeed when they are deeply embedded in local agri-value chains, with access to working capital, market linkages, and autonomy over key decisions. Many women-led groups are already leading the adoption of sustainable and climate-resilient practices. Strengthening them through enterprise support will generate both economic and environmental dividends. The Budget lays strong groundwork; execution will depend on how these initiatives reach real farms, in real time.”
Amod Anand, Co-Founder & Director, Loom Solar, said, “The announcements around ISM 2.0, electronics manufacturing, critical minerals, and rare earth corridors signal a fundamental shift in India’s clean energy trajectory. For the solar sector, this goes far beyond capacity expansion toward building deep technological sovereignty. India is moving from being a hardware assembler to owning critical layers of the energy-tech IP stack, control systems, forecasting platforms, and grid software that power modern solar and storage ecosystems. The rare earth corridors address a hidden but critical solar bottleneck by securing access to materials essential for high-efficiency motors, power electronics, and advanced energy systems, significantly reducing strategic dependence on China. Complementing this, customs duty exemptions for critical mineral processing, lithium-ion cell manufacturing for storage, and inputs like sodium antimonate for solar glass strengthen domestic value chains across materials, components, and technology, forming the backbone of India’s long-term energy transition and energy security infrastructure.”
Vivek Bhargava, Co-Founder, Consumer.ai, said, “What’s encouraging about the Budget’s focus on emerging technologies is that it nudges the conversation away from AI hype and toward real-world impact. National AI and quantum missions, backed by structured research funding, create the opportunity to apply intelligence where it matters most – understanding behavior, improving decision-making, and designing systems that are more inclusive by default. The real value of AI will come not from replacing human judgment, but from grounding it in observable reality and using it to make smarter choices at scale.”
Senthil Kumar Hariram, MD and Founder, FTA Global, said, “For the advertising and marketing industry, Budget 2026–27 signals a clear recognition of the services sector as a key growth engine, particularly through its focus on AI and emerging technologies. While there could have been more targeted measures for smaller service-led companies, the intent to simplify compliance, expand MSME financing, and invest in Tier-2 and Tier-3 infrastructure is a positive step. Evaluating the impact of AI on jobs and the services sector is timely for marketing and communications, as AI is already redefining how insights are generated, content is created, media is optimised, and campaigns are measured. The next step is ensuring AI adoption goes hand in hand with upskilling, enabling long-term, sustainable growth.”
Ajay Rao, Founder & CEO, Emiza, said,”The Union Budget 2026-27 further instills confidence in the consumption and manufacturing-driven growth story in India by continuing its emphasis on infrastructure development, with a special focus on MSMEs. The steps taken to enhance liquidity and growth capital for MSMEs will have a direct impact on logistics and fulfillment partners catering to small and medium-scale businesses in Tier 1 and Tier 2 cities. Contract logistics companies will find the Budget’s emphasis on technology adoption, AI- assisted skill development, and digital public infrastructure particularly relevant. As the scale and complexity of supply chains increase, data-driven demand forecasting, automated warehouses, and real-time inventory visibility are becoming increasingly important to provide faster, more reliable, and more cost-effective services for MSME supply chains. However, smooth payment cycles and simplified compliance procedures continue to be important for asset- and labor-intensive logistics companies. In summary, the Budget seamlessly weaves together infrastructure development, MSME growth, productivity, and technology to create a more robust and inclusive supply chain ecosystem in India.”
Kaushal Bansal, CEO & Co-Founder, CallerDesk, said, “Union Budget 2026–27 strengthens India’s digital infrastructure runway by encouraging cloud and data-centre investment. The tax holiday till 2047 for foreign companies providing global cloud services using India-based data centres is a strong signal to expand domestic capacity and long-term confidence in India’s cloud ecosystem. The Budget also improves policy clarity for IT services by enhancing the safe-harbour threshold from Rs 300 crore to Rs 2,000 crore and moving it to an automated, rule-driven process, steps that can reduce compliance friction. For MSMEs, the Rs 10,000 crore SME Growth Fund and the Rs 2,000 crore top-up to the Self-Reliant India Fund can improve access to risk capital. This matters because IDC projects India’s public cloud services market to reach $17.8 billion by 2027. For telecom and customer communication platforms, stronger cloud capacity can accelerate adoption of AI-led capabilities like conversational automation, real-time analytics and workflow intelligence, helping businesses improve service quality, responsiveness and operational efficiency at scale.”
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