With just one day left for the Union Budget, Micro, Small and Medium Enterprises (MSMEs) are pinning high hopes on the government for a significant boost. Widely regarded as the backbone of India’s economy, the MSME sector plays a crucial role in the country’s economic and social development, contributing nearly 29 per cent to GDP, 36 per cent to manufacturing output, and 44 per cent to India’s total exports in recent years.
The MSME sector is the second-largest employer in India after agriculture, providing jobs to nearly 11.1 crore people across manufacturing, trade and services. Ahead of the Union Budget 2026-2027, representatives of the MSME sector met on November 12, 2025, to present their expectations to the government. During the meeting, the sector urged Union Finance Minister Nirmala Sitharaman to enhance support for technology upgradation across various segments as part of its pre-Budget demands.
MSME Budget Expectations
The sector seeks government support through an enhanced technology upgradation fund for various segments. During the meeting, micro, small and medium enterprises also called for easier access to credit and assistance in exploring export markets, sources said. The discussions were held to gather inputs and suggestions for the Union Budget 2026-27, which is scheduled to be presented on February 1. The meeting was attended by Union Minister of State for Finance Pankaj Chaudhary, the Secretary of the Department of Economic Affairs, and officials from the Ministry of Finance and the Ministry of MSME.
Small and medium businesses are seeking targeted policy measures rather than broad-based incentives. The upcoming Union Budget offers an opportunity to boost MSME competitiveness by simplifying direct tax rules, streamlining GST procedures, speeding up refund timelines, and reducing litigation risks. Focused reforms in areas such as presumptive taxation, tax audits, dispute resolution, and export support is also expected. This will significantly lower compliance burdens, allowing businesses to free up resources for growth and expansion.
