Industry stresses Capex growth, Fiscal prudence at Pre-Budget Meet

In a pre-Budget meeting with Union Finance Minister Nirmala Sitharaman on Monday, representatives from various industry bodies presented a range of proposals aimed at bolstering economic growth. Key recommendations included tax exemptions for the middle class, reduced excise duty on fuel, and an emphasis on sustaining public capital expenditure (capex).
The discussions, part of the fifth round of consultations, reportedly centred on strategies for employment generation and boosting consumption. Industry leaders emphasized the need for factor market reforms to drive growth. Associations such as the Confederation of Indian Industry (CII) and the Associated Chambers of Commerce and Industry of India (Assocham) urged the government to grant infrastructure status to the hotel and tourism sector to attract foreign investments, reduce borrowing costs, and create jobs.
CII Chairman Sanjiv Puri reportedly highlighted the importance of enhancing disposable incomes to increase consumer spending. He suggested raising the MGNREGS wage from Rs 267/day to Rs 375/day, aligning with recommendations from the Expert Committee on Fixing National Minimum Wage. He also sought tax relief for individuals earning up to Rs 20 lakh annually and reductions in fuel excise duties to ease financial burdens on households and businesses.
Industry representatives underlined the critical role of public capex in sustaining economic momentum amidst global uncertainties. CII proposed a 25% hike in capex over the Rs11.1 lakh crore allocated for FY24-25, emphasizing its multiplier effect.
On tax reforms, Ficci Vice-Chairman Vijay Sankar recommended simplifying TDS and TCS rates into a streamlined two or three-tier structure to ease capital flows and reduce disputes. He also suggested eliminating the securities transaction tax (STT) to encourage capital market investments and aligning policies with India’s 2070 net-zero goals.
Assocham President Sanjay Nayar proposed expanding presumptive taxation to include MSMEs and sectors like data centers. He also advocated establishing MSME universities for skill development and integrated infrastructure townships to foster entrepreneurship and innovation.Key industry leaders, including Neeraj Akhoury of the Cement Manufacturers Association and Satish Reddy of Dr. Reddy’s Laboratories, called for balancing fiscal consolidation with growth measures. They suggested a 15% capex increase for FY26 to sustain economic momentum.

(Business Correspondent)