Startups Push Budget 2026 For Easier Credit, Tax Relief, Survival Incentives
Overview
Indian startups present a unified demand for Union Budget 2026, prioritizing early-stage survival, enhanced credit access, and simplified regulations. Founders cite persistent challenges with institutional lending, rigid compliance, and tax hurdles, arguing these impede innovation and growth. They call for outcome-based subsidies, clearer bank guidelines, higher GST thresholds, and targeted tax benefits to foster sustainable development and employment.
Startup Demands for Union Budget 2026
Startups across India have laid out a comprehensive wish list for the upcoming Union Budget 2026, slated for presentation on February 1. Their primary focus centers on bolstering early-stage survival through policy measures, facilitating easier financing options, and simplifying complex regulatory processes.
Startup Sector's Budget Priorities
Founders argue that despite numerous government support schemes, nascent companies grapple with limited credit access, rigid compliance norms, and significant taxation hurdles. They warn that unaddressed issues could stunt long-term growth and stifle innovation within the ecosystem.
Addressing Credit Gaps
Bharath Krishna Rao, CEO of electric mobility startup Emobi, stressed the need for budgetary support tied to concrete business outcomes. He suggested extending subsidies and targeted aid based on actual vehicle sales to boost manufacturing.
Rao highlighted ongoing challenges with institutional lending, noting that existing schemes like CGTMSE, MUDRA, and PMEGP often fall short. Banks and NBFCs continue to impose collateral requirements, limiting the approval rate of proposals despite government guarantees, thus restricting capital flow to startups. He urged the government for clearer, more consistent lending guidelines.
Incentivizing Impact and Innovation
Social and impact-driven ventures are also seeking dedicated policy attention. Abhinav Rao Kuchipudi, founder and CEO of ParentVerse, called for enhanced incentives, streamlined compliance, and improved access to grants for early-stage, impact-focused companies.
He specifically pointed to tax benefits for startups investing in family-focused innovation, women-led enterprises, and tech-enabled education as accelerators for growth. Kuchipudi also advocated for increased budget allocations towards child well-being, parental education, and mental health awareness.
Workforce Readiness and Employer Confidence
From a hiring perspective, Devashish Sharma, co-founder and CEO of Taggd, sees the budget as an opportunity to build employer confidence. He noted that labor reforms are simplifying compliance but sustained hiring and investment in skilling depend on organizational security.
Sharma suggested the budget could encourage employer-led training and support technology adoption without causing workforce disruption.
Taxation and Regulatory Hurdles
Avinash Deshmukh, COO of health and wellness startup iThrive, identified regulatory complexity and fragmented funding as major hindrances. He stated that survival is difficult for early-stage businesses navigating these environments.
Deshmukh proposed a significant revision of GST registration thresholds, suggesting an increase from ₹20 lakh to ₹1 crore to reflect current inflation and operational realities.
Startup leaders express hope that Union Budget 2026 will address these critical concerns, fostering a more stable and supportive ecosystem for innovation, job creation, and sustainable growth.
