The Union Budget 2025 has garnered positive reactions from the FMCG sector, with leaders praising its balanced focus on rural development, manufacturing, and consumer spending. Aasif Malbari, Chief Financial Officer of Godrej Consumer Products Ltd., highlighted how these initiatives will create new growth avenues for the industry, emphasizing the budget’s role in building a consumption-driven economy.
“The Union Budget 2025 takes a balanced approach by strengthening rural infrastructure, manufacturing, and consumer spending—three critical pillars for the FMCG sector,” Malbari stated. The government’s focus on rural development and job creation is expected to stimulate economic activity in semi-urban and rural areas, driving higher consumption and opening up new markets for FMCG companies.
Malbari pointed to the introduction of the National Manufacturing Mission as a key factor in enhancing domestic production capabilities. “The National Manufacturing Mission is a strong step toward enhancing domestic production, reducing import dependencies, and improving cost efficiencies,” he said. This initiative is set to promote innovation, boost local manufacturing, and support home-grown brands, helping them become more competitive in both domestic and international markets.
Another critical element of the budget is the tax reforms targeting the middle class, including the increase in the income tax exemption limit to ₹12 lakh. Malbari emphasized the impact of these reforms on consumer behavior: “Tax reforms benefiting the middle class will increase disposable income, further fueling demand across essential and aspirational FMCG categories.” This increase in purchasing power is expected to drive growth in both everyday necessities and premium personal care products, expanding the market reach for FMCG brands.
Malbari concluded by stating, “Overall, the Budget lays a strong foundation for a more consumption-driven economy, creating significant growth opportunities for the FMCG industry.” The combined focus on rural development, manufacturing incentives, and consumer tax relief is expected to strengthen the FMCG sector’s growth trajectory in the coming years, positioning India for sustained economic expansion.
