Union Budget 2026: Make in India tops industry wish list amid execution worries

The anticipation surrounding the Union Budget 2026, particularly the industry's strong desire for a renewed focus on domestic manufacturing and the 'Make in India' program, underscores a critical juncture in India's economic trajectory. This expectation is not merely a wish list but reflects a deep-seated strategic imperative for India to ascend as a global manufacturing powerhouse.

**Background Context: The Genesis of 'Make in India'**

India's journey towards industrialization has been long and complex. Post-independence, the initial focus was on import substitution and self-reliance, often through public sector dominance. While this laid some foundational industries, it also led to inefficiencies and a 'licence raj'. The economic reforms of 1991 liberalized the economy, opening doors to global trade and investment. However, despite significant growth in services, manufacturing's share in India's GDP remained stubbornly low, hovering around 15-17%, far below that of many East Asian economies. Recognizing this gap, and to create jobs for its burgeoning youth population, the 'Make in India' initiative was launched on September 25, 2014, by Prime Minister Narendra Modi. Its primary objective was to transform India into a global manufacturing hub, attract foreign investment, foster innovation, enhance skill development, and build best-in-class manufacturing infrastructure.

**What Industry Expects from Budget 2026**

As the Union Budget 2026 approaches, Indian industry stakeholders are vocal about their expectations. Their primary demand is a significant prioritization of domestic manufacturing and the 'Make in India' program. This isn't just about rhetoric; it's about tangible policy support. The industry has consistently highlighted several critical barriers: high compliance burdens, which involve navigating complex regulatory frameworks; elevated logistics costs, stemming from inadequate infrastructure and inefficient supply chains; and high energy costs, which directly impact manufacturing competitiveness. To address these, the budget is expected to focus on implementing simpler tax systems, which could involve further rationalization of the GST framework or targeted incentives; accelerating infrastructure development, particularly in areas like roads, railways, ports, and power; and fostering job creation, which is a natural outcome of a thriving manufacturing sector. These measures are seen as crucial to boosting overall economic growth and, critically, unlocking private investment, which is essential for sustainable capital formation.

**Key Stakeholders and Their Roles**

Several key stakeholders are central to the success of these initiatives. The **Government of India**, particularly the Ministry of Finance, NITI Aayog, and various line ministries (like Commerce & Industry, MSME), is the primary architect of policies, allocator of resources, and regulator. Their vision and commitment are paramount. **Indian Industry Associations** (e.g., CII, FICCI, ASSOCHAM) and individual companies are vital as they are the direct implementers and beneficiaries. They provide crucial feedback on ground realities and are the engines of economic activity. **Consumers** benefit from increased availability of quality, affordable domestic products, and the creation of jobs. **International Investors** are also key stakeholders, as their capital and technology can significantly boost India's manufacturing capabilities. Their confidence is heavily influenced by policy stability, ease of doing business, and return on investment.

**Significance for India: A Multifaceted Impact**

Prioritizing 'Make in India' in Budget 2026 holds immense significance for India. Economically, it can accelerate GDP growth, increase industrial output, reduce dependence on imports (improving the trade balance), and boost exports, thereby strengthening India's foreign exchange reserves. Socially, a robust manufacturing sector is a major job creator, particularly for semi-skilled and skilled labor, addressing India's demographic dividend and reducing unemployment. This, in turn, can lead to poverty reduction and improved living standards. Strategically, 'Make in India' is a cornerstone of the 'Atmanirbhar Bharat Abhiyan' (Self-Reliant India Campaign), aiming to build supply chain resilience and enhance national security by reducing reliance on critical imports. Politically, a successful manufacturing push can garner public support and strengthen India's position on the global stage as a reliable producer and trading partner.

**Historical Context and Broader Themes**

While 'Make in India' shares the spirit of self-reliance with India's early post-independence industrial policies, it differs significantly in its approach. Unlike the inward-looking, protectionist policies of the past, 'Make in India' is globally integrated, emphasizing ease of doing business, foreign direct investment (FDI), and export competitiveness. It aligns with broader themes of economic liberalization, good governance, and fostering a competitive business environment. It also seeks to integrate India into global value chains, moving beyond mere assembly to higher-value manufacturing.

**Future Implications and Constitutional Underpinnings**

If Budget 2026 effectively addresses the industry's concerns and provides a clear roadmap for 'Make in India', the future implications could be transformative. India could solidify its position as a global manufacturing hub, attract significant foreign and domestic investment, and create millions of jobs. However, challenges remain, including geopolitical shifts, rapid technological advancements (e.g., Industry 4.0), and the imperative for sustainable, green manufacturing practices. Continuous policy reforms, consistent implementation, and a focus on skill development will be crucial.

Several constitutional provisions and policies underpin these efforts. The **Directive Principles of State Policy (DPSP)**, particularly **Article 39(a)** (securing adequate means of livelihood), **39(b)** (distribution of material resources for common good), and **Article 43** (living wage, conditions of work, etc.), provide the philosophical basis for state intervention to promote economic growth and employment. Policies like the **Goods and Services Tax (GST)**, introduced in 2017 via the 101st Constitutional Amendment Act, are critical for simplifying indirect taxation and reducing compliance burdens. The **Production Linked Incentive (PLI) Schemes**, launched across various sectors, are a direct policy tool under 'Make in India' to boost domestic manufacturing and exports. Furthermore, initiatives like the **National Infrastructure Pipeline (NIP)** and **PM Gati Shakti** directly address the logistics and infrastructure bottlenecks identified by the industry, aligning with the budget's anticipated focus. The **Companies Act, 2013**, and ongoing **Labour Code reforms** also aim to improve the ease of doing business and create a more conducive environment for industry.