Archive · 26 Dec 2025
MSMEs and CII Outline Budget 2026-27 Expectations
The MSME sector is very important for India's economy, making up a big part of the GDP, manufacturing, and exports.
They employ a lot of people but face challenges like getting loans, following rules, and dealing with changes in global trade.
For the upcoming budget, they hope for better support in areas like digital bookkeeping, easier access to credit, and help to grow from small to medium-sized businesses.
The Confederation of Indian Industry (CII) also has suggestions for the budget.
They want the government to focus on keeping debt under control, being transparent about money matters, collecting more taxes, and spending money wisely.
They think using digital tools can help find people who aren't paying taxes and make sure subsidies go to the right people.
Both MSMEs and CII want the budget to help businesses and the economy grow stronger.
MSMEs contribute over 30% to India's GDP, 35% to manufacturing, and 45–46% to exports.
Key expectations for Budget 2026-27 include last-mile capacity building, expanded credit access, and support for scaling up businesses.
Deloitte suggests simplifying access to AI infrastructure and onboarding MSMEs onto formal platforms like TReDS, GeM, and ONDC.
Proposals include a 'green channel' for quicker credit processing and a liquidity and growth fund for MSMEs.
The last budget doubled the credit guarantee cover to Rs 10 crore and created a new 'Fund of Funds' for startups.
- Who
- Micro, Small and Medium Enterprises (MSMEs) and the Confederation of Indian Industry (CII)
- What
- Expectations and strategies for the Union Budget 2026-27
- When
- Upcoming Union Budget 2026-27
- Where
- India
- Why
- To address constraints around financing, skills, compliance, global trade volatility, and macroeconomic stability
MSMEs
CII
Budget Priorities
MSMEs
MSMEs seek last-mile capacity building, expanded credit access, and support for scaling up businesses.
CII
CII emphasizes debt stability, fiscal transparency, revenue mobilization, and expenditure efficiency.
Revenue Mobilization
MSMEs
MSMEs focus on simplifying access to AI infrastructure and onboarding onto formal platforms.
CII
CII advocates for increasing the tax-to-GDP ratio and leveraging digital and AI-based tools to expand the tax base.
Expenditure Management
MSMEs
MSMEs propose a 'green channel' for quicker credit processing and a liquidity and growth fund.
CII
CII suggests subsidy reforms, consolidating Centrally Sponsored Schemes, and encouraging states to obtain ratings for State Development Loans.
- GDP Contribution by MSMEs
- More than 30%
- Manufacturing Output by MSMEs
- Over 35%
- Exports Contribution by MSMEs
- 45–46%
- Employment Range by MSMEs
- 100 million to 290 million
- Credit Guarantee Cover
- Rs 10 crore (doubled from Rs 5 crore)
- Fund of Funds for Startups
- Rs 10,000 crore
- Targeted Loan Program
- Rs 2 crore for first-time entrepreneurs
- Focus Product Scheme Revenue Target
- Rs 4 lakh crore
- Central Debt Target for FY31
- 50% of GDP (plus or minus 1%)
- Fiscal Deficit Target for FY27
- 4.2% of GDP
- Tax-to-GDP Ratio
- 17.5% (centre and state combined)
- Public Distribution System Coverage
- 813 million people (57% of the population)
- Fertiliser Subsidies
- 39% of total central subsidies
- Centrally Sponsored Schemes Expenditure
- 11% of Central expenditure
Sources
Budget 2026 Wishlist: 5 Key MSME sector expectations
Budget 2026 wishlist: From renewables to critical minerals, 5 key sectors in focus
Union Budget 2026-27: CII outlines 4-point strategy for macroeconomic stability
Budget 2026-27: CII proposes 4-point fiscal plan to strengthen India’s macroeconomic stability
CII Calls For 4-pillar Strategy For Macro-economic Stability
