Budget 2026: Micro, Small, and Medium Enterprises as the Litmus Test for Economic Resilience

Authored by analysts Vikesh Sharma and Rajat Mehrotra, this intelligence report assesses the pivotal role of Micro, Small, and Medium Enterprises (MSMEs) in evaluating the efficacy of Budget 2026. As the backbone of the economy, MSMEs contribute significantly to employment, innovation, and GDP growth, yet face persistent challenges such as access to credit, regulatory burdens, and market competition. The forthcoming budget presents a critical opportunity to implement targeted fiscal policies, including tax incentives, streamlined compliance procedures, and enhanced digital infrastructure, which could bolster MSME resilience and stimulate broader economic recovery. Our analysis indicates that the government's commitment to these enterprises will serve as a key indicator of its strategic priorities and long-term economic vision. Failure to address MSME-specific needs may undermine growth prospects and exacerbate socio-economic disparities. Conversely, a robust support framework could catalyze sustainable development, foster entrepreneurship, and reinforce India's position in the global market. This report underscores the necessity for policymakers to prioritize MSME-centric measures in Budget 2026, ensuring alignment with national economic objectives and resilience against future disruptions.