As India prepares for the Union Budget 2026–27, to be presented on February 1, brand leaders and industry bodies are looking beyond conventional tax relief, seeking policy measures that stimulate consumption, strengthen infrastructure and support long-term sectoral growth.
Across sectors, brands are seeking a Budget that prioritises demand revival and cost efficiency alongside policy stability. Common expectations include further GST rationalisation, smoother input tax credit flows, faster refunds and simplified compliance to ease working capital pressures. Industry leaders are also calling for higher infrastructure spending, stronger credit support for MSMEs, and targeted incentives to improve competitiveness, particularly in export-oriented and consumer-facing sectors. Together, these measures are seen as critical to supporting consumption, enabling investment and insulating businesses from global volatility.
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Large consumer sectors push for GST rationalisation and demand revival
Consumption revival remains a key theme for the FMCG sector. Sudhir Sitapati, Managing Director & Chief Executive Officer, Godrej Consumer Products Ltd., said the company’s primary expectation from the Budget is targeted measures to boost demand, particularly through further GST rationalisation. “There are a few large, mass-consumption FMCG categories, especially in home care, that continue to be taxed at 18 per cent and could logically move to a lower slab such as 5 per cent to support demand. We also believe that higher allocations for infrastructure linked to labour- and water-intensive categories should be released in a timely manner.” He added that while the sector has already received meaningful stimulus over the past year, sustained focus on consumption will be essential to maintaining growth momentum.
Echoing similar concerns, Akshali Shah, Executive Director, Parag Milk Foods, noted that although GST and tax reforms have supported consumption over the past year, demand revival remains a priority for FMCG players. She pointed out that while urban consumption is showing signs of recovery, rural demand continues to face pressure from monsoon uncertainty and inflation. Shah said that ahead of Budget 2026, a continued policy push towards dairy and agriculture, particularly infrastructure, farm productivity, milk collection, modern processing, cold-chain expansion and improved access to credit, will be critical to driving efficiency, competitiveness and rural development.
She added, “Investments in modern processing technology, organised supply chains, and better farm practices will not only support farmers and reduce wastage but also give the Indian dairy sector greater global reach and recognition for quality products.”
Highlighting the dairy sector’s broader economic role, Dr. K Rathnam, WTD & CEO, Milky Mist Dairy Food Limited, said the sector remains central to India’s food security and rural livelihoods. He said Budget 2026 offers an opportunity to accelerate the next phase of growth, with further GST rationalisation on key inputs such as packaging, refrigeration, animal feed and veterinary services helping ease cost pressures and improve efficiency across the value chain.
“A strong policy push towards strengthening cold-chain infrastructure and logistics is critical. Enhanced capital subsidies, interest subvention schemes and easier access to long-term credit will help bridge existing infrastructure gaps, reduce wastage and improve milk quality, especially in hinterland regions,” he said. He added that targeted incentives for farmers and dairy companies, covering productivity, fodder development, animal health, affordable insurance and cold-chain logistics, would support income growth and supply consistency. From an industry standpoint, incentives for value-added products, automation, quality testing and sustainability could unlock investment in modern, scalable capacity, strengthening the sector’s long-term growth.
Mid-sized manufacturers and service players are also looking for continuity and targeted support. Suketu Shah, CEO, Vishal Fabrics Ltd., said last year’s Budget delivered tangible benefits for the textile sector, with improvements in exports, GST rationalisation, PLI expansion and progress on PM MITRA Parks translating into on-ground impact. He said the ₹5,272 crore allocation strengthened manufacturing, infrastructure modernisation and global competitiveness, and expressed optimism that Budget 2026 would build on this momentum with a sharper focus on technology and machinery upgrades.
“Higher allocations towards R&D and innovation, a stronger focus on the cotton value chain covering farm productivity, quality, and sustainability, and controlled garment imports will be crucial. Streamlined export processes through platforms like BharatTradeNet, improved access to export credit, and the implementation of progressive labour policies can further consolidate India’s leadership in the global textile value chain,” he said.
Platforms, exporters and emerging brands flag cost pressures and execution gaps
For MSMEs, Budget 2026 is expected to build on recent reform momentum. Dinesh Gulati, COO, IndiaMART InterMESH Limited, said that policy interventions over the past year have laid a strong foundation, and the upcoming Budget should deepen their impact. “The year gone by brought in some significant reforms for the MSME sector, and we expect the upcoming budget to complement those reforms further,” he said.
Gulati added that the Budget presents an opportunity to move GST from stabilisation to simplification, through a streamlined structure, easier input tax credit norms and faster refunds. He said credit support remains crucial, particularly through deeper implementation of the expanded CGTMSE framework, with targeted loans for first-time entrepreneurs, women and underserved groups. As MSMEs accelerate digital adoption, he also stressed the need for stronger policy support for AI, robotics and data analytics. In light of global trade disruptions, Gulati recommended temporary duty-drawback measures, forex risk support or interest subvention for exporters, while also flagging the need for greater budgetary attention to health, environment and long-term green economy priorities.
Export-focused sectors have also outlined expectations amid global uncertainty. The Gem & Jewellery Export Promotion Council (GJEPC) said it has submitted its pre-Budget recommendations to Finance Minister Nirmala Sitharaman, calling for measures to enhance export competitiveness, ease of doing business and industry resilience. The council has sought targeted duty rationalisation and procedural reforms to help manufacturers remain cost-competitive, diversify exports and support sustainable growth.
Kirit Bhansali, Chairman, GJEPC, said, “The global gem and jewellery trade is undergoing a major transformation. With high U.S. tariffs, evolving consumer preferences, and shifting global supply chains, it is imperative that India maintains its competitive edge. Our pre-Budget proposals are focused on making Indian exports more cost-efficient, strengthening SEZ operations, and improving policy frameworks that encourage investment and skill development.” He added that positioning India as a global diamond trading hub, alongside its leadership in cutting and polishing, will require stable and supportive trade policies.
Emerging fashion and D2C brands are also looking to Budget 2026 for targeted support. At VIRGIO, the gap between the 5 per cent and 18 per cent GST slabs directly affects pricing and demand, often forcing brands to absorb higher taxes as they move into mid-premium segments. This pressure is compounded by an input tax mismatch, as marketing, logistics and warehousing attract 18 per cent GST, tightening margins and working capital.
Balaji Kannan, Chief Financial Officer, VIRGIO said that for consumer brands, particularly in fashion, cost pressures extend beyond raw materials to marketing, fulfilment, technology and compliance. Budget measures that simplify GST, improve input tax credit efficiency and reduce compliance friction could materially ease these pressures.
“Additionally, continued focus on logistics infrastructure, export incentives for fashion and lifestyle brands, and support for technology-led supply chains can lower operational costs over time. When structural costs reduce, brands are better positioned to reinvest savings into product innovation, sustainability initiatives, and consumer experience rather than absorbing inefficiencies,” Kannan said.
In the food services space, Lenexis Foodworks highlighted structural challenges that could be addressed through policy reform. Aayush Madhusudan Agrawal, Founder and Director, said that rationalising GST on commercial rentals would ease cost pressures for restaurants and QSRs, particularly in the absence of input tax credit. He added that a single-window clearance system across food safety, environment, labour and taxation could improve ease of doing business, while targeted incentives or capex-linked support would help organised QSR brands expand into Tier 2 and Tier 3 markets.
“Given the sector’s strong contribution to youth employment, Budget policies that recognise job creation and support skill development and workforce expansion would further strengthen the industry’s long-term economic impact,” Agrawal explained.
As Budget 2026 approaches, what emerges clearly is a shared industry push for policy continuity coupled with sharper execution. Across sectors, leaders are seeking measures that not only ease immediate cost and demand pressures but also create a stable, investment-friendly environment capable of withstanding global volatility. With consumption, infrastructure and competitiveness at the centre of these expectations, the upcoming Budget is being viewed less as a one-year fiscal exercise and more as a signal of the government’s long-term economic intent.