Industrial Organisations Weigh Budget Direction Amid Mixed Expectations
Industrial organisations in Tamil Nadu have responded with cautious optimism to the Union Budget, welcoming its focus on capital expenditure and manufacturing while expressing concern over limited direct support for small and micro enterprises. The budget’s broad direction was seen as growth-oriented, but industry bodies felt that several expectations critical to grassroots industrial development were left unaddressed.
Manufacturing groups across Chennai, Coimbatore, and other industrial centres noted that while infrastructure spending can create long-term benefits, immediate relief measures for MSMEs remain inadequate. Rising operational costs, compliance pressures, and slow access to credit continue to affect smaller units, making targeted fiscal support essential.
Industrial Organisations Acknowledge Capital Spending Push
Industry representatives acknowledged that the proposed capital outlay of ₹12.2 lakh crore could help sustain demand for supplier and ancillary units across Tamil Nadu. Infrastructure-led spending is expected to create steady work for engineering firms, component manufacturers, and service providers linked to large projects.
Sector-focused initiatives such as textile parks, container manufacturing schemes, and technology upgradation programmes were also viewed positively. These measures may help small and medium units align with larger supply chains and improve production standards over time.
However, industrial organisations pointed out that capital spending alone cannot address the immediate challenges faced by micro and small enterprises. Without parallel tax reliefs or cost-reduction incentives, many units may struggle to participate fully in the growth cycle.
Industrial Organisations Flag Missing Tax Relief Measures
A key concern raised by industrial organisations was the absence of meaningful tax relief for MSMEs. Industry bodies expected enhanced depreciation benefits, reduced compliance costs, and simplified tax structures to help units modernise and reinvest in capacity expansion.
With input prices remaining high and regulatory requirements increasing, many small enterprises operate with limited margins. Industry representatives noted that the budget did not provide sufficient breathing space for these units to recover from financial strain accumulated over recent years.
The lack of direct tax incentives was seen as a missed opportunity to strengthen domestic manufacturing at the base level, where employment generation is highest.
Industrial Organisations Disappointed Over MSME Allocation Levels
Industrial organisations representing cottage and micro enterprises expressed disappointment over the budgetary allocation for MSMEs. The funding level was seen as falling short of industry expectations, especially when compared to the sector’s contribution to employment and economic activity.
Small business groups had anticipated a higher allocation aligned with overall economic output. They also highlighted the need to restore subsidy schemes that previously supported MSME growth and technology adoption. The withdrawal of such schemes has slowed modernisation efforts, particularly in rural and semi-urban clusters. Also Read: NGT Asks Tamil Nadu to Expand Proven Waste Control Model Across Public Events
Industry voices stressed that MSMEs require consistent policy backing, not just announcements, to remain competitive. Without adequate financial support, many units risk stagnation or closure, which could impact local employment and supply chains.
Conclusion
Industrial organisations see the Union Budget as a step in the right direction but not a complete response to the needs of small and micro industries. While infrastructure and manufacturing initiatives offer long-term promise, the absence of strong MSME-focused relief has left many stakeholders dissatisfied. A balanced approach combining capital investment with direct support measures may be essential to ensure inclusive and sustainable industrial growth.
