Union Budget 2026 Wishlist: “Convert policy into accessible, scalable support for startups & research-led innovation”

Moreover, Budget 2026 expectations for MSMEs are around easier access to working capital, smoother execution of government schemes, and digital capacity building.

According to NeoGrowth’s latest NeoInsights report, MSMEs are entering 2026 with constructive optimism. 86% MSMEs expect business growth in 2026, signalling a clear turn in confidence and 80% report improved business conditions in recent months, aided by festive demand and GST reforms. There is also indication that 1 in 2 MSMEs plan to take a business loan in 2026, pointing to expansion-led credit demand.

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Arun Nayyar, Managing Director and CEO, NeoGrowth, said, “The study points to early green shoots across the MSME sector. Festive demand, coupled with stronger digital payment adoption and GST 2.0 benefits has started to support business momentum. What stands out is the measured confidence among MSMEs, with growth plans.”

The Tech Panda asked MSME & startup industry players what their expectations are from the Union Budget 2026.

Dhruv Chopra, Managing Partner, Dewan PN Chopra & Co.

“Budget 2026 should be framed to deepen investor confidence by prioritizing predictability, administrative clarity and targeted structural reforms. Given recent portfolio outflows and exchange-rate pressure, the fiscal narrative must emphasise credible multi-year capex commitments, transparent debt trajectories and tax stability measures that reduce policy uncertainty for long-term capital. Practically, we expect the Budget to include: (i) clear statements on tax-policy stability (explicitly limiting ad-hoc rate changes and signaling multi-year tax roadmaps), (ii) administrative measures to speed dispute resolution and reduce retrospective risk, and (iii) regulatory steps to make domestic financial hubs and GIFT City more investment friendly (parity, faster approvals). These levers may be seen as high-value signals than headline rate tinkering; a combination of fiscal discipline + regulatory clarity will have the greatest near-term impact on foreign and strategic long-term allocations.”

Lakshmi Venkataraman Venkatesan, Founding & Managing Trustee, Bharatiya Yuva Shakti Trust (BYST)

“While the country has seen progressing through CGTMSE expansion, a credit gap of nearly INR 30 lakh crore remains. Only about 16-19% of MSMEs currently have access to formal credit, which must improve to at least 25% by 2028 as a significant step towards making Viksit Bharat@2047 a reality.  Additionally, the current loan size under the MUDRA scheme, particularly in the Shishu category, averages Rs. 37,000, which is insufficient for microentrepreneurs to expand and sustain their businesses effectively. Increasing loan amounts, providing up to 4% interest subvention and nil or token processing fee charges.  Margin money should not be insisted where advances capital subsidy is available otherwise maximum margin money should be 10 per cent under MUDRA scheme.

“The government must extend the INR 20 crore credit guarantee threshold to micro and first?generation women-led enterprises, not just startups, to help them scale their businesses to small enterprise category and support those who are lacking adequate assets.

“15-day automatic GST refund cycle must be implemented along with 12% statutory interest on delayed funds particularly supporting micro entrepreneurs in the handicrafts, retail and services businesses where margins are thin and which often run on weekly and monthly cash cycles. Delays of 30-90 days can force shutdown of such businesses with liquidity problem and default on loan repayments.”

Amit Chand, Founder, BYT Capital

“India’s aspiration to lead in frontier technologies will be defined not just by vision, but by the ability to convert policy into accessible, scalable support for startups and research-led innovation. While we acknowledge the foundational intent behind the ?1 lakh crore R&D Innovation Scheme and the proposed Deep Tech Fund of Funds announced in Budget 2025, the real test lies in execution—particularly in speed, clarity of access, and seamless coordination across ministries.

Deep tech will play a defining role in securing India’s technological sovereignty, strategic resilience, and long-term industrial competitiveness. To unlock its full potential, the government must take bold, outcome-driven steps to support high-risk innovation—especially where private capital alone cannot sustain the gestation cycle.

India now stands at an inflection point. Budget 2025 signaled intent. Budget 2026 must deliver action—not just through new initiatives, but by making existing mechanisms frictionless, founder-first, and ready for deployment. This year, our collective focus must shift from announcement to absorption—from policy architecture to tangible outcomes on the ground.”

Madhu Rajputra Peravalli, Co-founder, Troogue

“We keep talking about enabling startups, but real scale comes when the government becomes a customer, not just a regulator. A single government project says more to investors than ten pitch decks. On skilling too, we need to be brutally honest, training that doesn’t lead to employability is just expensive motivation. I would request the FM to consider funding platforms linking skilling to hiring. We also need to democratise AI access, which is currently affordable for only big tech, in order for India to become a leader in AI-led innovation. Finally, strengthening R&D tax incentives for startups building original IP will boost innovation, create more jobs and foster an environment wherein startups thrive.”

Vinay Bansal, CEO & Founder, Inflection Point Ventures

“The next Budget provides an opportunity to really impact innovation, Job creation and Value creation via democratizing angel investing in India, by allowing professionals to contribute to the growth of the startups via angel investing.  Small investors, who are professionals should be able to contribute significantly, establish diverse portfolios, share their expertise in helping grow the startups and profit alongside the startup ecosystem. Just like individuals are trusted to invest in publicly traded corporations, they should also be able to invest modest amounts in startups with sufficient safeguards. While we understand, that it is important to protect investors & their investments, the current accredited investor norms with their existing limits may become more relevant 10 years down the line when the Indian startup ecosystem has further evolved. Currently, practices around trust & transparency which are already incorporated under SEBI guidelines should suffice while still creating an environment where small investors can contribute more than just capital & yet benefit from potential returns while contributing towards the growth of the nation.”