Budget 2026-27: Manufacturing gets a boost; check sector-wise allocations

Several manufacturing-focused schemes received fresh allocations and enhancements in Budget 2026

The Union Budget 2026–27 placed manufacturing at the core of its expenditure priorities, with targeted allocations across strategic and industrial manufacturing segments.

 

Presenting the Budget in Parliament, Union Finance Minister Nirmala Sitharaman said the government remained committed to strengthening domestic manufacturing capacity while reducing critical import dependence.

 

“Keeping Atmanirbharta as a lodestar, we have built domestic manufacturing capacity, energy security, and reduced critical import dependencies,” Sitharaman said, adding that these measures supported employment generation and sustained economic growth.

Details of multi-sector allocations

 

Scheme / Programme	BE 2026–27 (₹ crore)	Previous allocation (simplified)
Bio-pharma SHAKTI	500	No allocation was made for the scheme in previous years
India Semiconductor Mission (ISM) 2.0	1,000	This is a new phase with no allocation earlier
Modified Programme for Semiconductors & Display Manufacturing	8,000	The scheme received ₹4,300 crore in the previous fiscal year
PLI Scheme – MeitY (Electronics Manufacturing)	1,527	The allocation stood at ₹7,000 crore in the previous fiscal year
Electronics Components Manufacturing Scheme	1,500	The scheme was introduced in 2025 and had no allocation earlier
Three Dedicated Chemical Parks	600	This is the first budgetary allocation for the scheme
PLI – White Goods (ACs & LED Lights)	1,004	The scheme received ₹304 crore in the previous fiscal year
PM Formalisation of Micro Food Processing Enterprises (PMFME)	1,043	The allocation stood at ₹1,500 crore in the previous fiscal year
National Industrial Corridor Development Trust (NICDIT)	3,000	The scheme received ₹3,000 crore in the previous fiscal year
Nuclear Power Projects	2,500	The previous allocation stood at ₹1,333 crore
National Investment and Infrastructure Fund (NIIF)	3,001	The fund received ₹1,700 crore in the previous fiscal year
SME Growth Fund	500	No allocation was made for the fund in earlier years
Fund of Funds for MSMEs	1,900	The allocation was ₹900 crore in the previous fiscal year
Raising and Accelerating MSME Performance (RAMP)	1,500	The scheme received ₹1,468 crore in the previous fiscal year
GECL for MSME Borrowers	9,000	An allocation of ₹9,000 crore was provided in the previous year
Promotion of Sports Goods Manufacturing	500	This is the first time the scheme has received budgetary support

 

 

New and expanded schemes for industrial manufacturing

Several manufacturing-focused schemes received fresh allocations or significant enhancements in the Budget. Among the key announcements was the launch of three dedicated Chemical Parks, which received a ₹600 crore allocation for the first time in BE 2026-27. The Budget also provided ₹500 crore for Bio-pharma SHAKTI, marking its first budgetary allocation.

 

The India Semiconductor Mission 2.0 was allocated ₹1,000 crore, while the Electronics Components Manufacturing Scheme received ₹1,500 crore in BE 2026-27. The production-linked incentive (PLI) Scheme for White Goods (ACs and LED Lights) saw its allocation rise to ₹1,004 crore, compared with ₹304 crore in the previous fiscal year.

MSME support linked to manufacturing expansion

The Budget reinforced support for micro, small, and medium enterprises (MSMEs) as part of the manufacturing push. Measures were announced to improve access to growth capital and formal credit for scalable MSMEs, alongside continued policy support for sectoral expansion.

 

On liquidity, the Finance Minister said transactions worth over ₹7 trillion had already been enabled through the TReDS platform, with further steps proposed to deepen invoice discounting and strengthen cash flows for smaller enterprises.

 

The Budget also maintained allocations for industrial infrastructure and corridor-led manufacturing. The National Industrial Corridor Development and Implementation Trust (NICDIT) retained an allocation of ₹3,000 crore, while investments in plug-and-play industrial parks were scaled up.

 

“These measures have delivered a growth rate of around seven per cent and helped make substantial progress in poverty reduction,” Sitharaman said.