Hails infrastructural support, financial initiatives, urges tailored approach for region’s unique economic challenges
SRINAGAR: The Federation of Chambers of Industries Kashmir (FCIK) has welcomed the Union Budget 2025-26, recognizing its strong emphasis on infrastructure and institutional support for the manufacturing sector. The leading industrial body believes these measures will drive employment, strengthen the supply chain, and uplift Micro, Small, and Medium Enterprises (MSMEs) across the country.
Reacting to the budget presented by Finance Minister Nirmala Sitharaman, FCIK highlighted the significance of initiatives under the *National Manufacturing Mission*, which aim to support industries of all sizes. The chamber commended the government for acknowledging MSMEs as the second engine of economic growth, contributing 30% to India’s GDP, nearly 45% of exports, and providing employment to around 80 million people nationwide.
“We are pleased to see substantial provisions aimed at enhancing MSME scalability, technological upgradation, and access to capital,” said the FCIK Advisory Committee, led by Shahid Kamili. The committee noted that, for the first time in years, MSMEs have received a major boost through a range of targeted financial and policy measures.
One of the most encouraging aspects of the budget, according to FCIK, is the enhanced credit guarantee cover for MSMEs, now increased to Rs 10 crore. This, along with various credit schemes and a Rs 10,000 crore *Fund of Funds* for startups, will significantly advance financial inclusion.
The introduction of the *MSE Credit Card*, designed to facilitate easier access to credit for micro-manufacturing units, particularly in rural areas, was also hailed as a potential game-changer. “If implemented efficiently, this initiative could provide a much-needed financial cushion for small and micro enterprises, helping them innovate and expand,” the chamber noted.
DPI-enabled export financing and term loans of up to Rs 20 crore for well-managed, export-oriented MSMEs will empower businesses to enter global markets, providing a much-needed boost to export houses in Jammu and Kashmir.
A particularly transformative step in the budget is the new scheme offering loans of up to Rs 2 crore for 5 lakh women, SC, and ST first-time entrepreneurs. FCIK believes this initiative will promote inclusive entrepreneurship, ensuring that underrepresented groups gain access to business opportunities.
Despite these positive developments, the chamber stressed that the true impact of these initiatives will depend on how swiftly businesses can access the allocated funds. The revised investment and turnover limits for MSMEs, now enhanced to 2.5 and 2 times, respectively, will also ease the burden on small and medium enterprises nationwide.
While FCIK praised the government’s broader initiatives in agriculture, IT, and skill development, it expressed concern over the lack of a focused approach towards Jammu and Kashmir. The chamber believes the region’s unique challenges—stemming from economic disruptions and structural difficulties—have once again been overlooked.
The increase in the income tax exemption limit to Rs 12 lakh is expected to provide relief to the middle and salaried classes, saving them an estimated Rs 1 lakh crore collectively. This, in turn, is likely to boost consumption and stimulate demand in the manufacturing sector.
However, FCIK remains disappointed that the specific hardships faced by J&K’s MSMEs have not been adequately addressed. Many businesses in the region are still struggling due to long-standing economic disruptions, and the lack of tailored interventions may leave them without the critical support needed for recovery and growth.
In light of this, FCIK has urged the Jammu and Kashmir government to integrate both new and existing central schemes with local policies to foster growth, revitalize struggling MSMEs, and create an ecosystem conducive to innovation and entrepreneurship. A clear, actionable roadmap is essential to ensure that J&K’s industries can fully benefit from the Union Budget’s provisions, enabling them to compete effectively and thrive in the national economy.