New Delhi, Feb 1 (NationPress) The significant escalation in capital expenditure to Rs 12.2 lakh crore, combined with the introduction of new freight corridors, national waterways, and development of city economic regions, proactively addresses the industry's concerns regarding infrastructure deficits and logistics expenses, stated the industry body Assocham on Sunday.

Labeling the Union Budget for 2026-27 as a forward-thinking and reform-oriented initiative that fortifies the groundwork for India’s medium to long-term economic advancement, the chamber emphasized that it embodies several crucial policy priorities consistently communicated by the industry. This includes the necessity for ongoing public investment, manufacturing-led growth, MSME enhancement, and a more straightforward, predictable regulatory environment.

The emphasis on developing city economic regions, particularly in Tier II and Tier III cities, is expected to unlock agglomeration advantages, stimulate regional development, and generate new urban hubs of economic activity. These initiatives will likely have a substantial multiplier effect on growth, attracting private investment and supporting long-term productivity improvements, according to Assocham.

"The Union Budget 2026-27 provides a definitive and credible reform framework for maintaining India’s growth trajectory. The robust emphasis on infrastructure, manufacturing clusters, and MSME support aligns with the core priorities of the industry," remarked Assocham President N.K. Minda.

By merging public investment with structural reforms and fiscal prudence, the Budget paves the way for increased private investment, stronger supply chains, and quality job creation across various sectors and regions, he added.

The proposal to create dedicated rare earth corridors in mineral-rich states such as Odisha, Kerala, Andhra Pradesh, and Tamil Nadu is particularly noteworthy for enhancing strategic supply chains and diminishing critical import vulnerabilities.

Furthermore, initiatives like ISM 2.0 and Biopharma Shakti are anticipated to bolster India’s standing in strategic and future-oriented sectors, while fostering technology development and skilled employment, as highlighted by the chamber.

From an industry standpoint, the clear recognition of MSMEs as growth "champions" is another commendable aspect of the Budget.

Additionally, the Rs 10,000 crore SME Growth Fund, expansion of cash-flow-based lending, and initiatives to strengthen NBFC-led credit delivery are poised to alleviate financing hurdles and enable MSMEs to scale up, integrate into global value chains, and contribute more effectively to exports and job creation.

Assocham Secretary General Saurabh Sanyal remarked that the Budget exhibits a strong alignment between industry insights and policy implementation.

"Initiatives concerning MSME financing, tax simplification, capital market enhancement, and services-led employment will enhance the ease of doing business and bolster investor confidence. The focus on scale, productivity, and competitiveness positions the economy favorably to navigate global uncertainties while advancing India’s long-term developmental goals," he stated.