New Delhi — The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has lauded the Union Budget 2025-26 as a “bold” move aimed at stimulating consumption, particularly among the middle-class segment, and fostering entrepreneurial growth.
Commenting on the budget, ASSOCHAM President Sanjay Nayar stated, “Finance Minister Nirmala Sitharaman has met broad expectations by offering significant relief to individual taxpayers while maintaining the fiscal deficit at 4.4% of GDP.”
Nayar emphasized the Finance Minister’s strategic focus on the middle class to drive consumption-led growth. “The budget reflects confidence in the middle class’s potential to invigorate the economy. Simultaneously, there is a strong emphasis on unlocking the capabilities of MSMEs, startups, and the export sector,” he added.
The budget introduces several measures designed to boost demand and investment. Key employment-generating sectors such as tourism, textiles, handicrafts, footwear, and toys have received immediate impetus, which is expected to create numerous job opportunities.
“The budget’s priority areas include agriculture, rural demand, agro and food processing, warehousing, and marine products. These focus areas are set to infuse greater vibrancy into the rural economy,” said Nayar.
One of the most notable tax reforms includes making annual income up to Rs 12 lakh tax-free. Additionally, the rationalization of TDS/TCS thresholds and slabs aims to simplify tax compliance for individuals and ease the business environment for small and micro-entrepreneurs.
“As highlighted by Prime Minister Narendra Modi, the government has forgone Rs 1 lakh crore in revenue through direct tax exemptions and reliefs primarily targeting the middle class. This bold approach is expected to stimulate economic growth,” Nayar remarked.
The budget also signals increased trust in taxpayers, focusing on voluntary compliance and simplified procedures. The forthcoming new Income Tax Bill is anticipated to further these objectives.
In addressing the issue of customs duty inversion, the Finance Minister has rationalized rates and prioritized the “Make in India” initiative. Reductions in customs duties on essential raw materials and critical minerals are expected to bolster value-added manufacturing, especially in the electronics sector.
Climate change and clean energy transitions remain integral to the budget, positioning India as a global leader in environmental sustainability, even as some large economies pivot back towards fossil fuels.
Startups and MSMEs have received substantial support through enhanced credit guarantee covers—doubled from Rs 10 crore to Rs 20 crore for startups and from Rs 5 crore to Rs 10 crore for MSMEs. A new Fund of Funds with an additional Rs 10,000 crore government contribution is expected to attract Alternative Investment Funds to invest in startups.
The budget’s inclusive approach extends to affordable housing, rural women, and healthcare. Furthermore, investments in scaling up IIT infrastructure and increasing medical education seats aim to strengthen the country’s human resource base.
A renewed focus on skill development, bolstered by global partnerships, is designed to prepare India for emerging technologies like Artificial Intelligence. Allocating resources for AI is expected to drive innovation and economic growth in the tech sector.
With comprehensive measures across sectors, ASSOCHAM views the Union Budget 2025-26 as a forward-looking blueprint poised to energize consumption, entrepreneurship, and sustainable development in India.
