Budget 2026 Expectations: Industry Seeks Focus on Public Capex, Fiscal–Monetary Alignment

As the Union Budget for FY27 nears, industry bodies are seeking policies with greater emphasis on improving the quality of investment, lowering transaction costs, and enhancing predictability for businesses. The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has urged policymakers to give heightened priority to sectors such as public capital expenditure in transport and logistics, transmission infrastructure, renewable energy, and industrial corridors.

“Faster clearances under PM Gati Shakti and a permanent dispute-resolution mechanism for infrastructure and PPP projects are critical to unlocking stalled assets and crowding in long-term private investment,” a pre-Budget memorandum of the industry body said.

On the trade front, ASSOCHAM has urged a time-bound customs amnesty for legal resolutions to provide an easy and transparent customs framework and reduce compliance uncertainty for the import and export sector. The Budget must now focus on precision reforms such as improving capital efficiency, ensuring statutory clarity, and reducing friction in taxation, trade, and finance. “These measures can unlock private investment and support sustained, job-creating growth without compromising fiscal discipline,” Manish Singhal, secretary general of ASSOCHAM, stated.

The industry has recommended reintroducing a concessional corporate tax regime similar to Section 115BAB of the Income-Tax Act for new manufacturing and services firms. The benefits of a concessional corporate tax regime should also extend to existing firms for fresh investments and capacity expansion, the memorandum said. Policy measures on the tax front are expected to support domestic value addition and boost export competitiveness, the memorandum highlighted. The body has also sought targeted amendments to the Income-Tax law to broaden tax neutrality for business reorganisations, including fast-track demergers.

The memorandum also underlined the need for “greater fiscal predictability” through timely Goods and Services Tax (GST) and RoDTEP refunds, alongside stricter enforcement of micro, small, and medium enterprises (MSME) payment timelines. The need to deepen the corporate bond market through expanded repo access was also noted by the industry body to support stable credit flow for non-banking financial companies (NBFCs), particularly those catering to MSMEs.

“Adoption of these targeted economic and statutory recommendations in the Union Budget 2026–27 would strengthen investor confidence, enhance productivity, and support India’s long-term development goals aligned with the vision of Viksit Bharat @ 2047,” the ASSOCHAM pre-Budget memorandum said.