Budget 2025: The big thrust towards manufacturing and supply chain ecosystem

To strengthen domestic manufacturing, FM Sitharaman announced the National Manufacturing Mission, stressing on EODB, MSME growth, employment generation and technology-driven competitiveness, all of which will unlock new market opportunities. For MSMEs, which contribute 36 per cent of India’s manufacturing output, the budget introduced several fiscal incentives.¹ It further emphasised reviving labour-intensive sectors (some of which slowed down in exports), introducing cluster-based development and a focus product scheme for sectors with high potential, such as toys, footwear and textiles.

Leaving geopolitical disruptions aside, India’s export performance has remained strong, with non-petroleum exports growing by 7 per cent last year, led by electronics, pharmaceuticals and engineering goods.² Aptly described as the fourth engine in the budget, the FM announced an Export Promotion Mission to streamline trade competitiveness. Additionally, the setting up of a unified digital trade platform—Bharat Trade Net—will simplify trade documentation and financing, aligning with global best practices and increasing efficiency. Customs-related proposals on tariff structure and duty inversion will further boost manufacturing, increasing value addition and accelerating exports.

The budget had a lot for logistics and connectivity, key to improving export competitiveness. The shipbuilding sector receives a boost, with dedicated clusters, skilling programmes and new technology adoption. Besides, the National Geospatial Mission, under PM Gati Shakti, will provide private sector access to critical data and maps, strengthening overall infrastructure development. Such increased manufacturing and logistics push can have a ripple effect on industrial and warehouse leasing activity, creating demand for new storage, distribution and logistics facilities.