MSMEs Left Out as Union Budget 2026 Focuses Elsewhere: ATIU
February 1, 2026
etnews / Ludhiana
Pankaj Sharma, President of the Association of Trade and Industrial Undertakings (ATIU), criticized the Union Budget 2026 on Sunday, stating that the central government has effectively ignored the industrial backbone of Punjab while prioritizing other regions. Sharma argued that while Finance Minister Nirmala Sitharaman focused on macro-level infrastructure, the specific needs of Ludhiana’s MSMEs, ranging from bicycle parts to hosiery, remain unaddressed.
The Finance Minister increased capital expenditure to ₹12.2 lakh crore for the upcoming fiscal year, yet the local industry leaders feel this massive outlay offers little relief to the state’s manufacturing sectors. Sharma highlighted that the budget failed to introduce a clear policy for online GST refunds, a major oversight that continues to block vital liquidity for small-scale entrepreneurs.
Ludhiana’s iconic bicycle and engineering industries faced a significant blow as the budget mention of new Production Linked Incentive (PLI) schemes excluded these sectors. Industry experts had expected incentives for bicycle parts and auto components to bridge the gap with global competitors, but the final document left these traditional strongholds without specialized support.
The ATIU president expressed deep concern over the lack of investment in local skill development. He noted that the budget provided no special packages for upgrading state and central institutes like CTR or ITIs, which prevents the local workforce from meeting the evolving technological demands of modern employers.
Infrastructure remains a primary grievance, with Sharma pointing out that no new freight corridors or major infrastructure projects were announced for Punjab. He remarked that the budget’s focus appeared heavily skewed toward North Eastern states, leaving Punjab's industrial hubs without the necessary logistics upgrades to reduce costs.
The security transaction tax (STT) hike on futures and options also drew fire from the association, with warnings that increased costs will likely dampen trading volumes. Furthermore, the ₹10,000 crore SME Growth Fund was dismissed as insufficient and far below the actual requirements of a sector struggling with high borrowing costs and a lack of interest subvention.
Overall, the industry body characterized the budget as a missed opportunity to protect domestic manufacturing. Sharma concluded that without direct policies to encourage MSME investment in Tier-2 and Tier-3 cities or a roadmap for startup encouragement, the budget fails to create a sustainable path for direct employment in the region.
Union Budget 2026 Punjab Industry Ludhiana MSMEs ATIU Pankaj Sharma GST Refunds PLI Scheme Bicycle Industry
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