Trade bodies said the Union Budget 2026-27 reflected a holistic development vision and therefore would give an overall fillip to Micro, Small, and Medium Enterprises (MSMEs) in the State.
The Karnataka Small Scale Industries’ Association (KASSIA) said, “The Budget laid emphasis on strengthening domestic manufacturing, scaling MSMEs, and bolstering infrastructure.”
B.R. Ganesh Rao, president, KASSIA said, “The key announcements such as the ₹10,000 crore SME Growth Fund, the top-up of ₹4,000 crore to the Self-Reliance India Fund, and support measures integrated for traditional sectors were expected to provide critical impetus to the micro and small enterprises across the country.”
“These measures aim to not only enhance capital access but also nurture competitive, export-oriented, and tech-enabled small businesses, which form the backbone of India’s industrial ecosystem,” he said.
“Overall, the Budget strikes a fine balance between growth, reforms, and inclusion, and provides a strong foundation to accelerate India’s journey towards a Viksit Bharat,” Mr. Rao said.
According to the Federation of Karnataka Chambers of Commerce & Industry (FKCCI), the Union Budget 2026-27 offers forward-looking and action-oriented proposals that reinforce India’s growth momentum while maintaining fiscal discipline.
“The ₹10,000 crore SME Growth Fund, mandatory adoption of TReDS for CPSE procurement, revival of legacy industrial clusters, and targeted tax and customs reforms will significantly improve liquidity, competitiveness, and formalisation of the MSMEs,” said Uma Reddy, president of FKCCI.
The Budget focused on the MSME credit flow, logistics infrastructure, electronics and semiconductor manufacturing, and tier-II and tier-III city development and was especially encouraging for Karnataka as it housed a large concentration of MSMEs, start-ups, technology firms, IT&digital services and export-oriented manufacturing units.
Measures such as enhanced TReDS coverage, professional compliance support for MSMEs, cluster revival, and improved ease of doing business would directly benefit the State’s industrial corridors and growth centres, Ms. Reddy said.
The FKCCI also underscored the importance of the Bharat Vistar initiative for strengthening Karnataka’s traditional and agro-based industries such as nuts, coconut, and sandalwood, enabling wider market access, value addition, and higher incomes for MSMEs and rural producers.
“The proposal on high-speed rail corridors will benefit the State. Faster connectivity from Bengaluru to key economic hubs will boost productivity, logistics efficiency, and regional growth,” she added.
Prashant Gokhale, president, the Bangalore Chamber of Industry and Commerce (BCIC), said, “The Budget strengthens national resilience amid geopolitical challenges and thoughtfully addresses key sectors. The focus on enhancing farmers’ income through value-added crops and technology adoption, investments in high-speed rail and infrastructure, especially in the North-East, and timely reforms for data centres and the IT sector will boost connectivity and India’s digital ecosystem,” Mr. Gokhale said.
The strong emphasis on the MSMEs and manufacturing would drive employment and stimulate demand for capital goods, he said.
K.R. Sekar, ex-president of BCIC, and mentor of the Direct Tax Expert Committee and Partner at Deloitte, commented, “The Budget thoughtfully addressed both (manufacturing and new-age IT). The revised margin of 15.5%, enhancement of the turnover threshold from ₹300 crore to ₹2,000 crore and the extension of tax holiday benefits for data centres are significant.”
Published – February 01, 2026 10:10 pm IST
