Union Budget 2025 Archives - Images Business of Fashion

Retail leaders welcome Budget 2025, say policy implementation is key

IMAGES Business of Fashion Bureau — Sat, 01 Feb 2025 14:18:58 +0000

The Union Budget 2025, which Finance Minister Nirmala Sitharaman presented, introduces transformative policies and financial support for startups, MSMEs, and entrepreneurs in India. Key highlights include a ₹10,000 crore Fund of Funds, extended tax exemptions for DPIIT-recognized startups until 2030, the launch of a Deep Tech Fund, Mudra Loans to empower homestay entrepreneurs, and targeted initiatives to boost sectors such as clean tech, medical tourism, and sustainable manufacturing. With a strong emphasis on innovation, inclusivity, and self-reliance, the budget sets the stage for India’s emergence as a global powerhouse in entrepreneurship and technology.

Here is how top industry leaders reacted to Budget 2025

Amar Nagaram, Co-Founder & CEO, Virgio

“The Union Budget’s focus on fostering innovation, empowering MSMEs, and strengthening India’s digital economy is a step in the right direction. The ₹500 crore allocation to deep-tech and AI innovation will be instrumental in driving AI-led advancements and data-driven solutions, enabling businesses to scale efficiently. The ₹20,000 crore investment in innovation, along with the establishment of a Deep Tech Fund, will play a pivotal role in accelerating the adoption of next-generation production technologies. Furthermore, the five-year Mission for Cotton Productivity will strengthen a powerful, proplanet, and premium raw material supply chain. Incentives for sustainable manufacturing and circular economy initiatives validate the growing shift towards responsible fashion. The significant enhancement of credit availability with guarantee cover for start-ups will provide crucial support for emerging businesses, while also generating employment opportunities. A progressive policy framework that supports startups will accelerate India’s journey to becoming a global hub for innovation and conscious consumption.”

Sachin Joseph – Executive VP – Marketing and IT, Paragon

“The 2025 Union Budget brings promising opportunities for India’s footwear industry, particularly with the introduction of a focused product scheme supporting design capacity, component manufacturing, and advanced machinery. As a brand deeply committed to delivering quality and affordability, we welcome these strategic measures that will enhance productivity, boost employment, and drive exports.

At Paragon Footwear, we believe in the potential of India’s footwear sector to set global benchmarks in quality and innovation. This policy push will further accelerate India’s position as a key player in both leather and non-leather footwear manufacturing. We look forward to leveraging these initiatives to continue offering the best to our customers while contributing to the industry’s growth.”

Dinesh Gulati, COO, IndiaMART InterMESH Limited

“We are delighted to see the overwhelming contribution and growth of the MSME sector in India and the government’s continuous focus on enhancing it further. Responsible for 45% of exports and employment to 7.5 crore people, MSMEs are one of the biggest sectors contributing to Indian GDP and we are glad to see that the budget has significantly recognised the sector’s play in the same.

Addressing the issues of credit access and skilling, much prevalent in the sector, saw significant reforms in the budget today. The revised criteria for classification and investment will encourage the businesses to scale up without losing incentives. The increase in credit guarantee cover, with additional schemes for 2-crore term loan for first-time women and customised credit cards till 5 lakh limit, is a major boost for the MSME sector. The expansion of the Fund of Funds for Startups with an additional INR 10,000 crore will encourage innovation and entrepreneurship at scale.

Another two important areas that demand special mention are the programmes for manufacturing and the skilling of the future workforce. The introduction of the National Manufacturing Mission to support the MSMEs through comprehensive policy backing and a detailed framework will further pave the way for us to become a global manufacturing hub.

The Launch of National centres of excellence for skilling, and Atal Tinkering Labs in government schools to encourage curiosity, innovation, and scientific temper indicates that the future of the country will be prepped and equipped with the right skills to take over.

The significant reduction in personal income tax remains the obvious highlight, as it will leave more disposable income in the hands of individuals. This is expected to boost consumption, particularly benefiting MSMEs and consumer-driven sectors, driving overall economic momentum.”

VKC Razak, MD, India’s VKC

“Being in the footwear industry, anything that is good for the footwear industry from all quarters including the government should be welcomed with open arms. The dedicated scheme for the leather and footwear industry and the employment generation opportunity is good. But the goodness of all policies will depend on how good it is when implemented or how well it can be implemented. So, implementation is key and most of all when a policy like this is rolled out, most of the benefits will only be tapped by large scale manufacturers while MSMEs will be left high and dry as they are not organised and remain out of this policy radar of the government.

This is a matter of great concern because the bulk of the employment and production lies in the MSME sector. And more than anything, even though this policy looks unbiased, most of the policies in footwear are focused towards the leather industry as they are more organised and well represented. But, 95% of the production is currently happening in non-leather and MSME sector. So, specific policies are required for non-leather and MSME if the policy needs to be impacted positively and to bring the required results.

Another important aspect is, even if good policies are announced, the constraints that it finds from other parallel policies when implemented diminishes and evaporates all the euphoria achieved through favourable policy announcements.”

Ramesh Kapoor, Chief Financial Officer, Numero Uno Clothing Ltd.

“The Union Budget 2025 presents a forward-looking approach to economic growth, with a clear emphasis on sectors like agriculture, rural economy, and renewable energy. From a retail sector perspective, the budget’s focus on boosting consumption through higher personal income tax exemptions and greater relief for senior citizens is a welcome move. This will undoubtedly increase disposable income and drive retail demand.

Additionally, the continued emphasis on infrastructure development, job creation, and export growth aligns with the broader vision of a more robust economy, which will further benefit the retail landscape. The introduction of reforms in taxation and regulations paves the way for ease of doing business, which is crucial for retail players. Overall, the budget’s balanced approach to fiscal consolidation and consumption growth sets a positive tone for the retail sector and the broader economy, laying the foundation for sustainable growth in the years ahead.”

Ms. Shriti Malhotra, Executive Chairman, Quest Retail – The Body Shop

“The increase in the income tax exemption limit to ₹12 lakh is a decisive step toward boosting urban consumption, allowing middle-class households greater financial flexibility and spending power. Additionally Atal Tinkering Labs and the expansion of skilling programs will empower the workforce of tomorrow, while the inclusion of gig workers in social security schemes provides much-needed recognition and stability for this crucial segment of the new-age economy. However, to truly unlock the full potential of India’s dynamic retail sector, we look forward to a structured National Retail Policy that streamlines compliance, supports omnichannel growth, and fosters sustainable employment opportunities.”

Mr. Suvendu Sahu, Group CFO & CTO, Quest Retail – The Body Shop

“The Union Budget 2025-26 takes notable steps toward strengthening consumer spending and ease of doing business, but it is little short on Government spending which is critical for urban/rural consumption and GDP growth.

The rationalising of tax structures, especially in Custom Tariff and limitations on cess and surcharge not only simplify trade but also reinforce India’s position as a global manufacturing hub under ‘Make in India’. At the same time simplification of TDS and TCS provision will significantly reduce compliance burdens for companies while fostering transparency and trust in the tax framework. This is particularly relevant for industries like beauty and personal care, where a stable, consistent and moderate tax environment can accelerate domestic production, investment, and job creation. By ensuring regulatory efficiency and a conducive environment for businesses, these reforms will strengthen India’s competitiveness in the global market.

We look forward to further policy measures including the new Income Tax Bill as announced by Hon’ble FM.”

Mr. Jigar Kirtibhai Patel, Managing Director of G3+ Fashion

“The Union Budget 2025 offers a unique preposition for the growth of Indian MSMEs and job creation. It is a forward looking perspective to support Indian MSMEs is a commendable initiative as these businesses account for over 45% of the country’s total exports. The budget positions Indian MSMEs with enhanced scalability prospects, technological upgradation, capital accessibility, investment and turnover growth — contributing towards their long-term success. As MSMEs grow, they will also provide millions of new employment opportunities for Indian youth, directly impacting India’s per capita GDP going forward, helping to meet the country’s target to become a developed nation by 2047.”

Mr. Achint Setia, CEO Snapdeal

“This budget is welcome news for crores of Indians in the middle and lower income brackets. By leaving more money in their hands and encouraging savings and investments, the budget is likely to add a strong push to retail consumption and economic growth.”

Mr. Harsh Somaiya – Co Founder, The Bear House

“We welcome the union budget announcements which offer some encouraging measures for our sector, specially the push for PLIs and improved infrastructure for textile clusters. In terms of manufacturing, The Bear House will benefit from the boost in technological upgradation and better access to capital, which will allow fashion industry like ours to more than double our investment and turnover limits. This will directly enable us to further expand and scale up our business to better serve our customers.

Ms. Ridhima Kansal, Director, Rosemoore

“Its clear that the government is taking this initiative with proper planning in mind because its goal is to shift India towards being an international toy producing country. This shift is expected to not only bolster local manufacturing but also avail significant avenues for retail development. In toys, preliminary analysis indicates that this step can potentially lead to a 15-20% growth in the Indian toy retail market over the next two years. But the impacts will not be limited to only the production of toys, ancillary industries will also be boosted along with supply chain, and employment in manufacturing and retail would also witness a positive trend. Such a holistic approach is what will ensure the growth of the self-sustaining retail ecosystem we are working towards.”

“Women benefit from both economic empowerment with the ₹5 lakh scheme and nutritional security with Poshan 2.0 in a two pronged approach budgetary intervention. This married approach addresses the health and health infrastructure gaps with the financial gap that need to be closed for women’s advancement.”

Shobhit Singh, MD and CEO, Stone Sapphire India Pvt Ltd (SSIPL):

“The Union Budget 2025 is a good hope for most sectors, such as toys, stationery, homeware, sports, and exports. What we are excited about is the reduction in GST on toys from 28% to 18%, which will make toys cheaper and encourage more domestic manufacturing. The government’s move to further build on the National Action Plan for Toys will help India become a global destination for toys. Clusters, skills, and a manufacturing ecosystem will ensure that India produces quality, innovative, and sustainable toys that reflect the ‘Made in India’ brand.”.

The government’s drive on ‘Make in India’ initiatives is one of the measures that would not only encourage and boost local productions but also enable the country to reduce imports dependence. We expected more focus and investment in sports and grassroots level promotion of sports in India, eyeing the upcoming trend and adaption of competitive sports in the country. It would have been huge for the growth of the sector. On the other hand, Increased capital investments in education or skill development exercises will spur educational stationery markets. We are keen to see the detailed action plan for skill development and whether it is directed to key sectors, effectively utilizing our existing large manpower and solving the need of efficient human capital in SME and MSMEs.

We also see the government’s efforts to increase the purchasing power of the middle class through tax relief as an important facilitator for consumer demand in all sectors. This is expected to redirect disposable income towards genuine quality and homegrown premium products, a favourable situation for our homeware, kitchenware and lifestyle brands. The steps to enhance exports and enhance India’s position in global supply chains might further benefit sectors that have been traditionally a little slower in exports such as toys, stationery, homeware, and sports goods. We are keen to learn more on this, but overall, this budget looks like a positive milestone for the growth and development of these sectors in India.”

Budget 2025: Big step ahead for footwear, leather goods

IMAGES Business of Fashion Bureau — Sat, 01 Feb 2025 14:06:17 +0000

For the eighth consecutive year, Finance Minister Nirmala Sitharaman presented India’s Union Budget for the 2025-26 financial year on February 1.

In her Budget 2025 speech, Sitharaman announced a ‘Focus Product Scheme’ for the Footwear and Leather sectors. The initiative aims to enhance productivity, quality, and competitiveness in these industries, creating 22 lakh jobs and driving a turnover of Rs 4 lakh crore.

The scheme is expected to boost exports by over Rs 1.1 lakh crore. It will also support design capacity, component manufacturing, and machinery for non-leather quality footwear production, she said.

She also announced the creation of an Export Promotion Mission to improve export credit, provide cross-border factoring support, and help MSMEs deal with non-tariff barriers in international markets.

Anupam Mittal, Founder & CEO at People Group and an investor in D2C startups wrote in a LinkedIn post: “More disposable income = More consumption = More economic growth. You don’t build an economy by making people feel gareeb. You build it by making them wealthier.”

Key Takeaways for Retail

Big boost for leather and footwear industry: The government is set to implement specific measures to enhance productivity, quality, and competitiveness of India’s footwear and leather sector. A focused product scheme will be launched to support design capacity, component manufacturing, and machinery for non-leather footwear, alongside leather-based products. This initiative is expected to generate Rs 400 crore in revenue.

Rs 2 Crore Loan for Women, SC/ST Entrepreneurs: The government announced a new scheme providing considerable funding for business owners – term loans up to Rs 2 crore for first-time borrowers, particularly, especially women and SC/ST communities, aiming to foster inclusive economic growth and reduce barriers to financing for these groups. The scheme aims to speed up the slow process of bridging the gender gap in India.

National Manufacturing Mission to further Make In India: Manufacturing mission to boost make in India across all industry sizes. A new manufacturing mission under the Make in India initiative will support small, medium, and large industries through comprehensive policy backing and a detailed framework. This will aim to improve domestic value addition and build India’s ecosystem for solar PV cells, EV batteries, motors and controllers, electrolysers, wind turbines, very high voltage transmission equipment, and grid-scale batteries.

Budget Boosts Startup Fundraising Outlook: Startups incorporated before April 1, 2030 will be able to receive the tax exemption benefits. Besides, the government also enhanced the credit guarantee cover for startups operating in 27 focus sectors important for Atmanirbhar Bharat from the erstwhile Rs 10 crore to Rs 20 crore.

Union Budget 2025: Fashion retail industry’s top expectations for growth & reform

Kajal Ahuja, Business Reporter — Fri, 31 Jan 2025 05:07:09 +0000

With the Union Budget 2025 approaching, all eyes are on Finance Minister Nirmala Sitharaman as she prepares to unveil key policy measures on February 1. The fashion, retail, and lifestyle sectors are eager for reforms that can boost demand, promote sustainable manufacturing, and strengthen the industry’s resilience. From tax relief to infrastructure investments, industry leaders are hopeful for strategic initiatives that will drive growth and long-term expansion.

Boosting Consumer Spending & Retail Growth

The retail industry, one of India’s key economic drivers, is looking forward to policies that enhance consumer purchasing power. Satyen Momaya, CEO, Celio India, emphasises the need for tax relief: “The apparel and lifestyle retail segment, impacted by subdued demand over the last 12-18 months and inflation, would greatly benefit from retaining the current GST slabs, especially for products priced at ₹1,000 and above. We also anticipate the swift implementation of a National Retail Policy to streamline operations and foster long-term growth.”

Similarly, Shriti Malhotra, Group CEO, Quest Retail (The Body Shop India), highlights the importance of consumer spending: “Private consumption is the cornerstone of retail growth, and we look forward to government policies that open up the purse strings of consumers through higher tax exemption slabs and reducing GST on essential personal care products. This would provide much-needed relief to the middle class.”

Yashu Jain, Co-Founder & CMO, MattLook Cosmetics also emphasises the need for initiatives that will drive the growth of consumer-driven sectors by saying, “In our wish list, tax rebates and incentives that support disposable income are of tremendous importance, given their direct benefit to lifestyle and beauty products. Investments in infrastructure and logistics will remain paramount in giving access to Tier 2 and Tier 3 markets that have emerged as the industry’s growth point.”

Strengthening Domestic Manufacturing & Sustainability

As the government aims to position India as a global textile and apparel manufacturing hub, industry leaders are urging policies that promote local production and sustainability. Jaiwant Singh Dhingra, Director of Marketing and Business Development, Numero Uno, notes: “We look forward to policies that prioritise lowering GST rates on clothing because this will increase affordability and stimulate demand. We also hope for policies that encourage domestic manufacturing through incentives and subsidies, especially for sustainable production methods.”

Similarly, Vinay Thadani, CEO at Vishal Fabric Limited, stresses the importance of sustainability: “Manufacturers are increasingly adopting eco-friendly practices to address environmental challenges. We are looking forward to making organic fibers, sustainable textiles, and no-chemical dyes a standard offering in the market. The government should set up a PPP model that fosters research and innovation in earth-friendly textile manufacturing.”

Thadani also opines that for FY25-26, India’s textile sector is expected to focus on strengthening its domestic market while also pursuing robust export growth, driven by rising demand in key global markets like the United States, Europe, and the Middle East. This presents a major opportunity for India to solidify its position as a leading textile supplier. To support this growth, the government could consider imposing a reasonable import tax on essential commodities and implementing a Cotton Price Stabilisation Fund Scheme to ensure stability in domestic cotton prices.

Encouraging Digital & E-commerce Expansion

The rapid expansion of digital retail and e-commerce has reshaped the fashion industry. With rising demand in Tier-2 and Tier-3 cities, improving logistics and simplifying online retail regulations remain a priority. Shyam Prasad, Co-founder & CEO, Brand Studio Lifestyle, emphasizes: “We are optimistic about policies that will bolster the fashion and retail industry. Measures to simplify taxation, promote sustainable practices, and enhance digital infrastructure will be crucial for fostering industry growth. We are confident that Union Budget 2025 will prioritise initiatives to empower startups, small businesses, and retailers through targeted incentives and announcements. A lower tax rate for new manufacturing units can open up more opportunities in India’s apparel sector. ”

Likewise, Harsh Somiya, Co-founder, The Bear House, advocates for a stronger e-commerce ecosystem: “Announcements to bolster our digital infrastructure and fortify the e-commerce ecosystem would further empower brands like ours to connect with customers nationwide and beyond.”

Infrastructure & Workforce Development

Beyond taxation and sustainability, industry players are urging the government to invest in infrastructure, supply chains, and skill development. Ramesh Agarwal, Whole Time Director, Rupa & Co, highlights the need for a robust textile workforce. As one of the leading exporters in the sector, Agarwal expects the government to focus on measures that enhance both domestic and global competitiveness. “We hope for the extension of the duty-free import facility for trimmings and enhancements to include made-ups, alleviating cost pressures and aligning us better with international market expectations,” he says adding, “We anticipate government investments in textile workforce skill development initiatives to better satisfy changing consumer demands. Reviving the Scheme for Integrated Textile Parks (SITP) and extending the PLI scheme would help drive manufacturing and exports.”

Similarly, Siddharth Dungarwal, Founder of Snitch, underscores the need for workforce and technology investment: “Policies such as tax rationalization, investment in technology upgrades, and incentives for developing a future-ready workforce can empower businesses like ours to drive innovation, create jobs, and solidify India’s position as a global fashion and retail hub.”

The Road Ahead

The Union Budget 2025 presents a critical opportunity to address the evolving needs of the fashion, retail, and textile industries. By implementing consumer-friendly tax reforms, promoting sustainable production, strengthening digital retail infrastructure, and fostering workforce development, the government can unlock significant growth in these sectors. As businesses eagerly await policy announcements, the industry remains hopeful that the budget will pave the way for a thriving and competitive fashion retail ecosystem.