MSME, Khadi, handloom and textile industries have got a big gift in the Union Budget 2026. A growth fund of ₹10,000 crore, mega textile park and focus on rural industries will provide new opportunities to lakhs of entrepreneurs and artisans.
This time, the Union Budget 2026–27 has especially focused on MSME, Khadi, handloom, silk and textile industries, which are considered the backbone of the country. This budget is not just a document of figures, but presents a picture of the future of millions of entrepreneurs, artisans and workers who earn their livelihood with the help of small industries and traditional skills. This budget is considered to open new opportunities and new avenues of investment for states like Uttar Pradesh.
Integrated textile program to boost production and employment
A comprehensive and integrated program for the textile sector has been proposed in Budget 2026. Under this, schemes like National Fiber Scheme, Textile Extension and Employment Scheme, National Handloom and Handicraft Programme, Tex-Eco Initiative and Samarth 2.0 have been brought on one platform. Its objective is to increase production capacity as well as to create employment and accelerate exports. Also, the establishment of mega textile parks is expected to give a new dimension to investment and industrial development in Uttar Pradesh.
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Rural economy strengthened by Khadi and village industries
Special focus has been kept in the budget on Khadi and village industries. According to Micro, Small and Medium Enterprises, Khadi and Village Industries Minister Rakesh Sachan, Khadi, handloom and handicrafts will be promoted through Mahatma Gandhi Gram Swaraj Initiative. This will strengthen the rural economy and provide sustainable livelihood opportunities to weavers and artisans. This is being considered an important step towards increasing the income of traditional industries by connecting them with the modern market.
Growth Fund and Financial Relief for MSMEs
To empower the MSME sector, an SME Growth Fund of ₹10,000 crore has been announced in the budget. Apart from this, additional capital of ₹2,000 crore will be infused into the Self-reliant India Fund. The scope of the TReDS platform will be expanded to address the biggest problem of small enterprises, i.e. lack of timely payments and working capital. This will enable MSMEs to get timely payment and better financial support.
Corporate Mitra and Rejuvenation of Legacy Clusters
A scheme has been introduced in the budget to provide business guidance, technical support and market connectivity to MSMEs through the ‘Corporate Mitra’ system. Along with this, a proposal has also been made to rejuvenate 200 heritage industrial clusters across the country, which will include clusters related to handloom and handicrafts. This initiative can prove to give a new identity to the traditional industries of Uttar Pradesh and strengthen them in global competition.
Promote exports, keep an eye on the global market
Many important provisions have been made in the budget to encourage exports. Steps like expansion of duty-free import of shoe uppers and extension of time limit for export of leather and textile apparel will increase the competitiveness of Indian products in the global market. This will not only increase exports but will also create new employment opportunities.
Overall, the Union Budget 2026–27 signals a new beginning for the MSME, Khadi and textiles sector. This budget can play an important role in strengthening the goal of self-reliant India by connecting traditional industries with modern needs.
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