Manufacturing is considered to have contributed a relatively modest share to India’s GDP. Keeping this in mind, industry stakeholders and nationalist economic groups such as Bharatiya Mazdoor Sangh, Swadeshi Jagaran Manch and Laghu Udyog Bharati are pressing for a sharper manufacturing push in the upcoming Union Budget, with a special focus on MSMEs and decentralised growth.
The government had already announced a dedicated manufacturing mission last year. Swadeshi Jagaran Manch (SJM) wants this to receive a greater push, with a strong thrust on clean-tech manufacturing covering solar and wind energy, green hydrogen, electric vehicles and allied sectors.
According to SJM economist and co-convener Ashwani Mahajan, these initiatives, aimed at boosting overall economic growth and employment generation, are expected to receive a significant push in the forthcoming Budget.
MSMEs emerged as crucial contributors in Defence and Space Sector
“Recent progress in sectors such as defence and space manufacturing has reinforced this argument. In both sectors, MSMEs have emerged as crucial contributors to supply chains, innovation, exports and job creation. Keeping this in mind, there is a growing call to realign PLI incentives in favour of smaller enterprises to deepen domestic manufacturing capacity.” Ashwani Mahajan said.
Clean-tech manufacturing has been chosen as a main focus area. This includes electric vehicles, green hydrogen, battery energy storage systems and component manufacturing.
A major demand is linked to the Production Linked Incentive (PLI) schemes. SJM said that while the PLI programmes have attracted multinational companies and big corporates, the next phase should focus more on the MSME sector.
It pointed out that MSMEs are vital for creating jobs, boosting exports and adding value, and therefore should be at the core of India’s manufacturing strategy.
According to Bharatiya Exporters Forum, Telangana, over the next five years MSMEs need strong support for technology funding to modernise operations and improve productivity. They also require financial assistance for certifications to meet quality and export standards.
“Technology funding is very important, especially as India has signed several free trade agreements—most recently with Europe this week, earlier with the UK, and with many other countries. For Indian MSMEs to compete in export markets, they must produce high-quality goods, which requires modern technology and proper certifications,” Vidya Sagar, Convener of the Bharatiya Exporters Forum, Telangana, said.
He added – “Therefore, technology funding for MSMEs is crucial, and this is what I expect from the Budget. In addition, there should be dedicated credit lines for overseas buyers, so that when other countries want to import from India, financing is available specifically to support imports from Indian industries.
Union Budget 2026: Vacant Land allocation
Speaking on land reform, Mahajan said land has become a key issue in the current economic system. He said large areas of land owned by public sector units, private companies and institutions are lying unused and are not creating jobs or growth. Industry representatives stress the need for faster and more transparent land allocation to support economic development.
To deal with this, SJM renewed its demand for a tax on vacant land and called for a digital land records mission using AI to identify and verify land for industrial use. It also proposed a Plug-and-Play manufacturing model, where land, infrastructure, approvals and utilities are provided in advance so industries can start work quickly.
What is Plug-and-Play manufacturing model?
Under this model, small-scale units would not be required to purchase land or navigate complex compliance requirements; instead, they could begin production by simply installing their machinery, significantly reducing time and cost.
Schemes such as One District, One Product (ODOP) have also been cited as landmark achievements, particularly in states like Uttar Pradesh. There is a demand to further scale up ODOP while linking it with “One District, One Heritage” initiatives to strengthen tourism infrastructure and local economies.
Better social security for workers, labour-friendly reforms – BMS
Bharatiya Mazdoor Sangh (BMS)has asked for better social security for workers, labour-friendly reforms, more funds for job-creating sectors, and greater focus on MSME-based manufacturing growth.
On social security, BMS demanded that the minimum EPS-95 pension be raised to ₹7,500 per month and linked to the Consumer Price Index so it increases with inflation. It also sought Ayushman Bharat coverage for EPS pensioners, higher wage limits under ESI and EPF, better gratuity benefits, and the return of railway fare concessions for senior citizens.
“We want scheme workers like ASHA, Anganwadi, Mid-Day Meal, NHM and Gramin Dak Sevaks to be officially recognised as government staff, with higher honorariums and special allowances for those working in difficult areas.” said BMS Former President Saji Narayan. He also demanded that VB-G RAM (MGNREGA) workdays be increased from 100 to 200 per household, along with higher wages to match inflation.
- Link pensions to the Consumer Price Index for inflation adjustment
- Extend Ayushman Bharat health coverage to EPS pensioners
- Increase ESI and EPF wage ceilings
- Enhance gratuity benefits
- Restore railway fare concessions for senior citizens
The trade union also urged the government to expedite implementation of the Code on Wages (2019) and the Code on Social Security (2020), while seeking the removal of what it termed “anti-worker provisions” in labour laws through compulsory consultation with trade unions.
Union Budget 2026: Employment Generation and MSME Focus
Employment and livelihood security form a central pillar of the BMS submission. The organisation has sought targeted support for:
- Fisheries and allied sectors
- Renewable energy–based rural livelihoods
- MSMEs and small industries
- Agriculture-linked employment
- Handloom workers and street vendors
- Self-employed workers
