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Union Budget 2026-27 Boosts MSMEs with Increased Allocation, Says Minister Manjhi

Union Minister Jitan Ram Manjhi hailed the Union Budget 2026-27 as being entirely for Micro, Small, and Medium Enterprises, which he called the backbone of the Indian economy. The budget increases the allocation for MSMEs from Rs 23,168 crore to Rs 24,566 crore, aiming to boost GDP, production, and exports. Finance Minister Nirmala Sitharaman proposed a dedicated Rs 10,000 crore SME growth fund and outlined a four-point plan to improve MSME financing and liquidity. The broader vision is to leverage MSME growth to help India become the world's third-largest economy by 2030 and a developed nation by 2047.

Key Points: Budget 2026-27: Increased MSME Allocation to Fuel Growth

  • MSME allocation raised to Rs 24,566 crore
  • New Rs 10,000 crore SME growth fund announced
  • Aim to make India 3rd largest economy by 2030
  • Four new measures to enhance MSME financing
3 min read

"MSMEs backbone of Indian economic system": Union Minister Jitan Ram Manjhi lauds Union Budget

Union Minister Jitan Ram Manjhi praises the budget's focus on MSMEs, with allocation rising to Rs 24,566 crore to boost GDP and exports.

"I believe this budget is entirely for MSMEs, and that's because MSMEs are the backbone of the Indian economic system. - Jitan Ram Manjhi"

New Delhi, February 1

Union Minister for Micro, Small, and Medium Enterprises Jitan Ram Manjhi on Sunday praised the Union Budget 2026-27, emphasising that the backbone of the Indian economic system, MSMEs, have gotten an increased allocation, from Rs 23,168 crore to Rs 24,566 crore. With the aim of boosting GDP, production, and exports, subsequently making India the world's third-largest economy by 2030 and a developed nation by 2047.

Speaking to the reporters, Manjhi said, "I believe this budget is entirely for MSMEs, and that's because MSMEs are the backbone of the Indian economic system. After agriculture, in every aspect--whether it's GDP, production, or exports--our MSMEs lead the way. In view of this, the 2025-26 budget of Rs 23,168 crore has been increased to Rs 24,566 crore. So, you can understand the significance of this budget for MSMEs.... This budget from the Government of India is a very good budget for MSMEs. From this perspective, the budget is aimed at becoming the world's third-largest economy by 2030 and moving toward becoming the world's leading developed nation by 2047, in which MSMEs' contribution is immense. That's why all this has been done... Significant efforts have been made in this budget to strengthen India's economic system through MSMEs, which is commendable."

Earlier today, the Union Finance Minister, Niramala Sitharaman, proposed introducing a dedicated 10,000 crores SME growth fund to create future jobs, incentivising enterprises based on select criteria. She stated that the government recognises MSMEs as a vital engine of growth, and proposes a three-pronged approach to help them grow as champions. Equity support.

"I propose to introduce a dedicated 10,000 crores SME growth fund to create future champions, incentivising enterprises based on select criteria. I also propose to top up the self-reliant India fund set up in 2021 with 2,000 crores to continue support to micro-enterprises and maintain their access to risk capital," she said.

More than Rs 7 lakh crore has been made available to MSMEs through liquidity support.

"To leverage its full potential, I propose four measures. One: mandate TREDS as the transaction settlement platform for all purchases from MSMEs by CPSEs. Survey as a benchmark for other corporates. Two: introduce a credit guarantee support mechanism through CGT-MSC for invoice discounting on the TREDS platform. Three: link GEN with TREDS to share information with financiers on government purchases from SMEs, encouraging more affordable and faster financing. Four: Introduce TREDS receivables as asset-backed securities, helping develop a secondary market, enhancing liquidity and settlement of transactions," the Minister said.

Sitharaman also noted that the government shall continue to focus on developing infrastructure in cities with over 5 lakh population, that is, Tier II and Tier III cities, which are expanded to become growth centres.

Finance Minister Sitharaman presented her record ninth consecutive Union budget today in the Parliament.

- ANI

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Reader Comments

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Sarah B
While the increased allocation and new funds sound good on paper, the real test is whether this money reaches the actual small business owner on the ground. Past schemes have been bogged down by red tape. Simplifying the process is key. The TREDS platform mandate is a good technical move, though.
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Vikram M
Absolutely correct that MSMEs are the backbone! We employ the most people after farming. The focus on exports is crucial. If the government can help us with global market linkages and ease of doing business, we can truly compete internationally. Jai Hind! 🇮🇳
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Priya S
The 10,000 crore fund for future champions is interesting. But the criteria for selection must be clear and fair. It should support innovative startups and traditional artisans equally. We don't want only tech-based businesses in metros to benefit.
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Rohit P
Good budget for small business. But inflation is still a big problem for us. Raw material costs are up 30% in two years. While credit helps, controlling input costs is equally important for MSME survival and growth.
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Michael C
The linkage of GeM with TREDS to share information is a smart, tech-forward policy. It should reduce the payment delays from government departments, which is a chronic issue. Faster payments mean healthier cash flow for small businesses. Thumbs up for that.

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