Union Budget 2025-26: FMCG Sector Gains from Rural Focus and Tax Reforms

The Union Budget 2025-26 has outlined several measures to support the growth of the FMCG sector, aiming to strengthen consumption and enhance the overall business environment. With a focus on stimulating demand, particularly in rural areas, the budget provides key relief in the form of tax cuts on essential goods and incentives for MSMEs. The emphasis on sustainable growth through green initiatives, along with investments in infrastructure and improved supply chain efficiency, will provide a significant boost to the FMCG landscape. As the sector navigates a rapidly changing consumer landscape, these budgetary provisions are expected to create new growth opportunities and reinforce the industry’s pivotal role in India’s economic development.

Aasif Malbari, Chief Financial Officer - Godrej Consumer Products Ltd.

"The Union Budget 2025 takes a balanced approach by strengthening rural infrastructure, manufacturing, and consumer spending—three critical pillars for the FMCG sector. Investments in rural development and job creation will boost economic activity and drive higher consumption, opening new opportunities for market expansion. The National Manufacturing Mission is a strong step toward enhancing domestic production, reducing import dependencies, and improving cost efficiencies. Additionally, tax reforms benefiting the middle class will increase disposable income, further fueling demand across essential and aspirational FMCG categories.

Overall, the Budget lays a strong foundation for a more consumption-driven economy, creating significant growth opportunities for the FMCG industry."

Angshu Mallick, MD & CEO, Adani Wilmar Ltd.

“The Union Budget 2025 reflects a strong commitment to strengthening India's agricultural ecosystem, with a clear focus on enhancing productivity, promoting crop diversification, and improving post-harvest infrastructure. The focus on tax reliefs and measures aimed at increasing disposable incomes, especially for the middle class; is a positive move that will strengthen purchasing power and drive demand for quality food products.

The launch of Prime Minister Krishi Yojana targeting low-productivity districts is a progressive step that will not only boost farm incomes but also support the growth of allied sectors like edible oils and food processing. The Budget takes encouraging steps toward improving agricultural productivity and boosting consumer well-being. Support for oilseed cultivation and food processing will enhance domestic production, while tax reforms and rural development efforts are expected to drive consumer demand.

We are also seeing a growing awareness of nutrition, with more people making healthier food choices. As incomes rise, particularly within the expanding middle class, the demand for nutritious foods is increasing, making the government’s focus on improving the accessibility and affordability of essential food items a welcome move.

Additionally, the enhancement of cost norms for nutritional support programmes like Saksham Anganwadi and Poshan 2.0 will strengthen efforts to improve the nutritional status of children, women, and adolescent girls. We welcome this move, as at Adani Wilmar, we are equally dedicated to combating malnutrition and promoting healthier lifestyles through initiatives like Fortune SuPoshan.

At Adani Wilmar, we remain committed to providing high-quality, nutrition-rich products. By working together, the industry and the government can ensure that healthier choices are accessible to people, contributing to a better-nourished society.”

Mayank Shah, Vice President, Parle Products

"The Union Budget takes a bold step toward spurring demand for consumer goods, addressing challenges the sector has faced over the past few years. For instance, making an effective tax free income of Rs.12.75 lakh is quite effective as it increases consumption due to higher disposable earnings. The capturing of rural demand via targeted agricultural investment across 100 regions, along with MSME aid assistance, will serve the dual purpose of creating additional employment and uplifted spending power.

Some new job opportunities and utilization of physical resources and economic activity is expected with the increased concentration on rural and urban infrastructural development, which includes the Urban Challenge Fund. The consumer demand has largely been depressed in the recent past due to inflation and increasing costs of inputs, but with these changes, the hope is that there is an increase of purchasing power within the common man. Consequently, this will also create a demand for capital goods supporting industries further down the line.

In a nutshell, the budget lays the foundation of economic growth across all sectors rather than just certain groups and so the long term positive impacts will be felt across the board. It is a goal oriented look towards broad based economic development, expansion of demand, recovery development and sustainability."

Dheeraj Arora, Managing Director & CEO, Hygienic Research Institute, Pvt. Ltd says, “The Union Budget 2025 presents a clear roadmap for revival and growth in the FMCG sector. With income tax relief aimed at enhancing disposable income, we anticipate a surge in consumption, which will directly accelerate demand. The government's strategic initiatives, including reduced tariffs and easier credit access, are designed to streamline supply chains and lower input costs. Additionally, customs simplifications and the National Manufacturing Mission will boost domestic production, fostering innovation and competitiveness. These measures lay a strong foundation for innovation and competitiveness, paving the way for sustained growth.”

Satyen Momaya, CEO, Celio India says, “Prima facie the Union Budget 2025-2026 sets the stage for a stronger resilient economy , the current biggest challenge is the slowdown of the pvt consumption, the tax change for the salaried class could positively benefit the middle class to some extent also the budget outlines various initiatives to make tax compliance easier for businesses. The thrust on infrastructure & green growth and sustainability thrust outlined in the budget could be very positive specially for the long-term growth of the country.”

Also Read: Union Budget 2025-26: Industry Leaders hail Growth and Innovation