Budget 2026: MSMEs, Startups Demand Liquidity Relief, Easier Norms

ECONOMY
Whalesbook Logo
AuthorRiya Kapoor|Published at:
Budget 2026: MSMEs, Startups Demand Liquidity Relief, Easier Norms
Overview

Budget 2026 expectations are in, with MSMEs and startups urging the government to address critical funding gaps and regulatory burdens. Industry bodies like ASSOCHAM and CII are calling for liquidity infusions, faster GST refunds, and simplified compliance to foster sustainable growth and boost entrepreneurship.

MSME Demands

The Associated Chambers of Commerce and Industry of India (ASSOCHAM) stressed that MSME growth is fundamental to job creation and export performance. The chamber urged stringent enforcement of payment deadlines and accelerated Goods and Services Tax (GST) and Remission of Duties and Taxes on Export Products (RoDTEP) refunds to alleviate working capital constraints.
ASSOCHAM also called for timely support for sectors impacted by tariff shifts, specifically mentioning textiles, gems and jewellery, and seafood. To curb operational expenses, they sought expanded incentives for MSMEs to adopt distributed renewable energy solutions. Furthermore, the body proposed wider cash-flow-based lending via digital infrastructure and Account Aggregators, alongside targeted credit enhancements for Non-Banking Financial Companies (NBFCs) lending to MSMEs to reduce borrowing costs. Simplified customs procedures and improved logistics were also highlighted to promote cross-border e-commerce exports.

Startup Reforms

The Confederation of Indian Industry (CII) pointed to recent corporate governance issues within Indian startups, emphasizing the necessity for robust oversight mechanisms. CII recommended promoting independent supervision, bolstering shareholder protections, and fostering transparency to ensure ethical management focused on long-term viability.
To fortify the policy environment, CII suggested enabling startups to maintain accounts in non-INR currencies to facilitate global expansion. They also advocated for easing compliance burdens by reducing the number of required approvals, streamlining licensing processes, and simplifying adherence to labour and taxation regulations.

Broader Economic Context

These industry expectations align with ongoing concerns voiced by founders across various sectors. Despite government initiatives, startups continue to grapple with restricted access to credit, rigid compliance, and taxation challenges. Punjab National Bank MD and CEO Ashok Chandra indicated that MSMEs are likely to remain a central focus in the Union Budget 2026, alongside rural infrastructure and capital expenditure-driven growth. Such priorities, he noted, are vital for nurturing new entrepreneurs and attracting capital investment.

Disclaimer:This content is for educational and informational purposes only and does not constitute investment, financial, or trading advice, nor a recommendation to buy or sell any securities. Readers should consult a SEBI-registered advisor before making investment decisions, as markets involve risk and past performance does not guarantee future results. The publisher and authors accept no liability for any losses. Some content may be AI-generated and may contain errors; accuracy and completeness are not guaranteed. Views expressed do not reflect the publication’s editorial stance.