As the Union Budget 2025-26 approaches, the Federation of Indian Chambers of Commerce and Industry (FICCI) has presented an 11-point agenda aimed at boosting economic growth, increasing ease of doing business, and inclusive growth. To be sure. Building on the momentum of the Union Budget 2024-25, which focused on Wicket India and highlighted nine reform priorities, FICCI emphasizes the need for sustained and deep reforms.

Key recommendations from FICCI

Increase capital expenditure
FICCI has proposed a 15% increase in capital expenditure for FY26 as against ₹11.11 lakh crore allocated in FY25. These investments focus on physical, social, and digital infrastructure as critical to sustaining global growth. “Given the uncertainty amid persistent global warming, the government’s emphasis on public investment in physical, social and digital infrastructure will be critical to sustain growth momentum,” it said.

Reform factor markets
An inter-state institutional platform like the GST Council is proposed to reform the land, labor and power sectors, which are critical to economic competitiveness but often mired in state-level complications. “Many of the next-generation reforms are at the state and coordination levels and require consensus to take them forward. Inter-state institutional platforms on the lines of the GST Council can be created – specifically But for reforms in the land, labor and power sectors,” suggested FICCI.

Simplify the tax structure
Recommendations include rationalization of TDS/TCS rates into a simple two- or three-tier system, abolition of TDS/TCS on GST transactions.

“Also, stop the practice of levying TDS/TCS on transactions subject to GST as the relevant information is already available through GST filings,” recommended FICCI.

Independent dispute resolution forum

To reduce litigation on direct tax matters, FICCI suggested introducing a new forum consisting of independent experts like retired Supreme Court or High Court judges, retired President/Vice President of Tribunals or professionals like lawyers. Professionals or Chartered Accountants with minimum experience. Deal with disputes at the assessment or post-assessment level.

“A time-bound resolution by an independent forum will instill confidence in taxpayers who may come forward to settle matters instead of litigating for fear of fines and litigation. This will avoid lengthy litigation and Claims/refunds due to such litigation will be curtailed,” the apex body said.

Accelerate sustainability initiatives.
FICCI also emphasizes India’s commitment to net zero emissions by 2070, proposing initiatives such as carbon capture technologies, a circular economy framework, and green financing within the priority sector lending framework. A center of excellence for climate smart agriculture technologies has also been proposed.

• Develop carbon capture, utilization and storage technologies as a mission in line with the Green Hydrogen Mission to accelerate the deployment of tech solutions for industrial decarbonisation.
• Create green transition pathways for all sectors to meet India’s net zero emissions target by 2070. The roadmap should look at all aspects like technology, financing, circularity, impact on jobs etc.
• Launch a national-level vision document for a circular economy that provides a framework with clear goals, strategies and initiatives that promote circular practices across sectors.
• Initiate a review of the priority sector lending framework to ensure its scope for climate adaptation and climate risk reduction activities such as clean transportation (e.g. electric vehicles), EV charging infrastructure, sustainable water and waste Management, recycling etc.
• Announce a center of excellence for development and evaluation of climate smart agriculture technologies. Commercialize at least 5 climate smart technologies, each adopted by at least 5 million farmers in the next 3 years.

Increasing women’s participation in the workforce
For economic empowerment of women it is proposed to provide tax exemption for day care expenses and encourage use of CSR fund for construction of hostels for women in manufacturing sector. The main recommendations are-

• The government may consider creating a statutory body to certify day care centers and regularly monitor their quality for standardization.
• Commuting from home to the workplace is generally seen as a barrier to women’s employment in the manufacturing sector, especially when such locations are far from residential areas. The construction of the hostel will enable more women to participate in manufacturing. Government may consider allowing use of CSR funds for establishment and maintenance of hostels for women.
• Consider a special tax exemption for working women for child care expenses up to 5 years of age up to a certain limit.

Strengthen the Atmanirbhar defenses
FICCI recommends prioritizing indigenous and partnered defense production, promoting research in advanced technologies and promoting defense exports through a dedicated agency.

• Only defense equipment made in India / Partnership in India will be procured.
• Accelerating research efforts to develop technologies to keep the Indian Armed Forces ahead in areas such as robotics, quantum computing, sensors, hypersonics, directed energy and AI and ML.
• Build capabilities for millions of cheap small and micro drones that are weaponized.
• Establish a Defense Export Promotion Agency to coordinate with the armed services, their foreign directorates, DPSUs, private manufacturers, MEAs, Indian embassies and MoD and foreign government and buyers. can talk together

Increase in agricultural production
Key proposals include launching an agricultural production mission for the bottom 100 districts, training 3 million farm technicians, and increasing private sector participation in horticulture clusters.

• Initiate agricultural production mission for bottom 100 districts on the lines of Aspirational Districts Programme.
• Launch a national program to train 3 million farm technicians over 5 years to provide new technology and services to farmers. Each village (there are 6 lakh villages in India) may have 5-6 technical experts in areas such as soil testing, micro-irrigation, drones, sensors, farm machinery, post-harvest technologies as well as intra-village water supply systems. Operation and maintenance of .
• horticulture by completing the allotment of 12 priority clusters, initiating RFPs for the remaining 41 identified clusters, allowing participation of farm aggregators and encouraging adoption of individual verticals at the cluster level by large specialized companies. Encourage private sector adoption of clusters.

Promotion of domestic manufacturing of PCBAs
Addressing import dependency, FICCI proposed to rationalize tariffs, simplify HS codes and incentivize domestic PCBA production to boost the electronics manufacturing sector.

“Rationalization of tariffs and HS codes for PCBAs for different applications is the key issue. Further, as per discussions with the industry, we suggest that the government should levy a differential of 25 percent on custom duty on PCBAs. For example, if the customs duty is 20 percent on finished electronic products, then the PCBA for that finished product may be at 15 percent customs duty Are, we request That for these manufactured goods PCBA can be allowed to import goods on concessional rate of duty (IGCR) route under IGCR.Also, we need to be careful that the tariff is reasonable be made so that there is no change in duty,” FICCI said.

Focus on primary education.
A national Information, Education, and Communication (IEC) campaign on basic literacy and numeracy is proposed, along with school competitions for parents and vouchers to promote quality education. “Offer vouchers in the form of e-Rupee to parents of school-going children to be redeemed to send children to schools chosen by parents. Focuses on school outcomes, good disparities between both public and private schools. Encourages competition.

Health care reform
FICCI also recommends raising public health care spending to 2.5 percent of GDP, increasing tax benefits for preventive care and health insurance and encouraging investment in health care infrastructure, particularly In Tier 2 and Tier 3 cities.

According to the Economic Survey, “India’s public expenditure on healthcare rose to 2.1 per cent of GDP in FY23 and 2.2 per cent in FY22, as against 1.6 per cent in FY21. Yet this OECD FICCI recommends increasing this allocation to 2.5 percent of GDP by 2025. As envisaged in the National Health Policy 2017.

To meet the growing healthcare demands under Ayushman Bharat, FICCI also recommended provision of 50% additional depreciation under Section 32 of the IT Act for investments in diagnostic infrastructure, especially outside metro cities. of This is consistent with the benefits of depreciation in other sectors and supports the vision of affordable health care for all. “Also offer tax incentives to domestic manufacturers, which will attract global manufacturers. Additionally, increase the depreciation rate of life-saving equipment from 40 to 60 percent, given their short lifespan and rapid technological development.” Looking,” he said.

The Economic Survey 2023-24 projects a growth rate of 6.5-7.0 per cent for FY 2024-25, a moderation from the 8.2 per cent recorded in FY24 but a reflection of India’s resilience in a challenging global environment.

FICCI’s recommendations aim to build on this foundation, ensuring that India continues its journey towards economic self-reliance, sustainability, and inclusive growth.