Business bodies said the Union Budget 2026-27 reflected a holistic vision of development and would therefore provide an overall benefit to micro, small and medium enterprises (MSMEs) in the state.
The Karnataka Small Scale Industries’ Association (KASSIA) said, “The budget laid emphasis on strengthening domestic manufacturing, scaling up small and medium enterprises and strengthening infrastructure.”
BR Ganesh Rao, President, KASSIA, said, “Key announcements like ₹10,000 crore SME Growth Fund, ₹4,000 crore increase in Self-Reliance India Fund and integrated support measures for traditional sectors are expected to provide a major boost to micro and small businesses across the country.
“These measures aim not only to improve access to capital but also to support competitive, export-oriented and tech-savvy small businesses that form the backbone of India’s industrial ecosystem,” he said.
“Overall, the Budget strikes a fine balance between growth, reforms and inclusion, providing a solid foundation to accelerate India’s journey to Viksit Bharat,” Mr. Rao said.
According to the Federation of Karnataka Chambers of Commerce and Industry (FKCCI), the Union Budget 2026-27 offers forward-looking proposals and measures to boost India’s growth momentum while maintaining fiscal discipline.
“A ₹10,000 crore SME Growth Fund, mandatory adoption of TReDS for CPSE procurement, revival of legacy industrial clusters and targeted tax and customs reforms will significantly improve liquidity, competitiveness and formalization of SMEs,” said Uma Reddy, President, FKCCI.
The budget focused on credit flow to MSMEs, logistics infrastructure, electronics and semiconductor manufacturing and tier II and III city development and was particularly encouraging for Karnataka as it housed a large concentration of SMEs, start-ups, technology firms, IT and digital services and export-oriented manufacturing units.
Measures like improved TReDS coverage, professional compliance support for SMEs, revival of clusters and ease of doing business would directly benefit the state’s industrial corridors and growth hubs, Ms. Reddy said.
FKCCI also highlighted the importance of the Bharat Vistar initiative to strengthen Karnataka’s traditional and agricultural industries such as nuts, coconut and sandalwood, enabling wider market access, value addition and higher income for small and medium enterprises and rural producers.
“The proposed high-speed rail corridors will benefit the state. Faster connectivity from Bengaluru to key economic hubs will increase productivity, logistics efficiency and regional growth,” she added.
Prashant Gokhale, President, Bangalore Chamber of Industry and Commerce (BCIC), said, “The Budget strengthens national resilience amid geopolitical challenges and thoughtfully addresses key sectors. Focus on increasing farmers’ incomes through value-added crops and adoption of technology, investment in high-speed rail and infrastructure, especially in the Northeast, and timely reforms in the IT and data center sectors will strengthen India, sir,” Gokhale said.
A strong emphasis on SMEs and manufacturing would boost employment and stimulate demand for capital goods, he said.
KR Sekar, former president of BCIC and Mentor of the Expert Committee on Direct Taxes and partner at Deloitte, said, “The budget has thoughtfully addressed both (manufacturing and new-age IT). Revised margin of 15.5%, increase in turnover threshold from ₹ 300 crore to ₹ 2,000 crore are significant expansions of tax centers and holiday benefits.
Published – 1 Feb 2026 22:10 IST
