The Union Budget 2026–27, presented in Parliament on Monday by Finance Minister Nirmala Sitharaman, places a strong emphasis on expanding India’s manufacturing capabilities across seven strategic and frontier sectors. The initiatives form a major component of the government’s ‘First Kartavya’ priority area outlined in the Budget.
Rs 10,000-crore Biopharma Mission Announced
A major highlight of the Budget is Biopharma SHAKTI, a Rs 10,000‑crore programme over five years aimed at establishing India as a global biopharmaceutical manufacturing hub. The initiative seeks to strengthen domestic production of biologics and biosimilars through:
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Three new National Institutes of Pharmaceutical Education and Research (NIPERs)
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Upgradation of seven existing NIPERs
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Creation of a network of more than 1,000 accredited clinical trial sites
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Strengthening the Central Drugs Standard Control Organisation (CDSCO) with a dedicated scientific review cadre
ISM 2.0 to Boost Semiconductor Manufacturing
To advance India’s semiconductor ambitions, the Budget proposes launching India Semiconductor Mission (ISM) 2.0, building on the existing ISM 1.0 framework. The upgraded mission will focus on production of semiconductor equipment and materials, development of full‑stack Indian intellectual property, and supply chain fortification. Industry-led research and training centres are also planned to develop specialised talent.
Electronics Manufacturing Scheme Outlay Nearly Doubles
The outlay for the Electronics Components Manufacturing Scheme, launched in April 2025, has been increased from Rs 22,919 crore to Rs 40,000 crore to capitalise on the sector’s strong growth momentum.
Rare Earth Corridors Planned in Four States
A new scheme for Rare Earth Permanent Magnets will support Odisha, Kerala, Andhra Pradesh and Tamil Nadu in establishing dedicated Rare Earth Corridors. The initiative aims to promote mining, processing, research and manufacturing in the critical minerals space.
Three Chemical Parks to Reduce Imports
To reduce import dependency in chemicals, the Budget proposes setting up three dedicated Chemical Parks through a competitive challenge route. These cluster-based, plug‑and‑play parks will be developed in partnership with States.
Push for Capital Goods and High-Precision Manufacturing
The Finance Minister also announced steps to strengthen domestic capability in capital goods:
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Establishment of Hi-Tech Tool Rooms at two CPSE locations for automated, digital design and production of precision components
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A new Construction and Infrastructure Equipment (CIE) scheme for manufacturing advanced equipment such as lifts, firefighting systems and tunnel‑boring machines
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A Rs 10,000-crore Container Manufacturing Scheme over five years to build a globally competitive container production ecosystem
Integrated Programme for Textile Sector
For the labour-intensive textile sector, the Budget proposes a five-part Integrated Programme comprising:
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National Fibre Scheme for natural, man-made and new-age fibres
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Textile Expansion and Employment Scheme for cluster modernisation
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National Handloom and Handicraft Programme to unify existing schemes
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Tex‑Eco Initiative for sustainable textiles
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Samarth 2.0 to modernise skilling through industry‑academia partnerships
The government also plans to establish Mega Textile Parks in challenge mode, with a focus on value-added technical textiles.
Khadi and Handicrafts to Be Strengthened
A new Mahatma Gandhi Gram Swaraj initiative will aim to strengthen khadi, handloom and handicrafts by improving skilling, quality processes and global branding. The scheme is expected to support weavers, rural industries, ODOP products and young artisans.
Dedicated Push for Sports Goods Manufacturing
Highlighting the potential of India’s sports goods sector, the Budget announces a dedicated initiative to encourage manufacturing, research and innovation in equipment design and material sciences.
