Indian industry remains strongly optimistic about the country’s economic trajectory, with nearly 80 per cent of respondents expressing confidence in India’s growth prospects, according to a pre-Budget survey released by the Federation of Indian Chambers of Commerce and Industry (FICCI).
The survey, conducted ahead of the Union Budget 2026–27, indicates that close to half of the participating industry leaders expect India’s gross domestic product growth to remain in the 7–8 per cent range in FY 2026–27. This outlook reflects sustained faith in India’s medium-term economic fundamentals despite ongoing global uncertainties and trade-related challenges.
Confidence in fiscal management also emerged as a key theme. Around 42 per cent of respondents expect the government to meet its fiscal deficit target of 4.4 per cent of GDP in FY 2025–26. The finding underscores industry’s belief in the government’s fiscal consolidation roadmap and its ability to balance growth priorities with macroeconomic stability.
The survey highlights three macroeconomic priorities that industry expects the Union Budget to address: job creation, continued emphasis on infrastructure development, and stronger support for exports. Infrastructure, manufacturing, defence and micro, small and medium enterprises were identified as sectors likely to receive focused policy attention in the upcoming budget.
According to the survey findings, sustained government thrust on manufacturing and capital expenditure remains critical. Industry respondents emphasised the need for setting up a mega electronics industrial cluster that would bring together original equipment manufacturers, electronics manufacturing services firms and component suppliers. Such a cluster is seen as vital for strengthening India’s electronics ecosystem and enhancing domestic value addition.
Defence manufacturing also featured prominently in industry expectations. The survey suggested increasing the share of capital outlay in defence allocations to 30 per cent to accelerate modernisation of frontline assets, including unmanned aerial vehicles, counter-UAV systems, electronic warfare systems and artificial intelligence-enabled capabilities. Respondents further recommended enhancing the Drone Production-Linked Incentive outlay to Rs 1,000 crore and creating a Rs 1,000 crore Drone Research and Development Fund to support innovation in the emerging sector.
Export competitiveness emerged as another major concern amid rising global trade frictions. The survey noted industry expectations of stronger budgetary support for exports in the face of uncertainties related to global tariffs and non-tariff barriers, including carbon border adjustment mechanisms and deforestation-linked regulations.
To strengthen India’s integration into global value chains, respondents stressed the need for streamlining trade facilitation and customs processes, easing logistics and port-related bottlenecks, and improving export incentive and refund mechanisms. The survey recommended enhanced allocations under the Remission of Duties and Taxes on Exported Products scheme to boost export competitiveness. Industry also expects reforms in special economic zone policy and further rationalisation of customs tariffs, with a proposal to converge tariff rate slabs into three levels to simplify compliance and reduce costs.
On direct taxation, industry expectations include simpler compliance through greater digitisation, improved tax certainty, and more effective dispute resolution and litigation management mechanisms, according to the FICCI survey.
