FMCG, consumer durables, fashion brands eye spending boosters this Budget

With the Union Budget 2025 just around the corner, brand leaders are calling for reductions in GST rates on essential and discretionary goods to make products more affordable and drive volume growth. Disposable income remains crucial for sectors like FMCG, consumer durables, and fashion, where demand is directly linked to purchasing power. Brands across categories are hoping for transformative measures that would boost confidence, encourage consumer spending and support long-term economic growth.

Industry stakeholders are particularly focused on tax relief measures, seeing them as key to stimulating consumer demand. Beyond tax considerations, industry leaders are emphasising the need for policies that would strengthen domestic manufacturing capabilities. With global supply chains evolving, many industry observers feel enhancing India's position as a manufacturing hub will boost local production and ensure competitive pricing.

Take action against inflation

As the economy continues to grapple with inflation and slow growth, the FMCG sector is particularly feeling the pressure, as consumer spending becomes more cautious and discretionary purchases are delayed. FMCG industry leaders are calling for measures that can ease the burden on consumers and increase their purchasing power.

Prashant Agarwal, Marketing Head - Health Supplements at Dabur India Limited, says the brand’s key expectation from the budget is to support urban consumers and boost their income. 

He explains, “As an FMCG marketer, we see urban India facing demand constraints, with consumers struggling due to inflation and stagnant income growth,” adding that government support would increase consumers’ disposable income, which in turn would help drive demand for FMCG products. 

“With consumption down and the FMCG sector under pressure, we’re closely watching for measures to ease this strain,” said Nikhil Sharma, Managing Director at Perfetti Van Melle India. 

He further points out that measures aimed at reducing GST, along with incentives to boost consumption will bring much-needed relief from financial pressure on the FMCG sector and its consumers. The sector is keenly watching for any measures that can hike demand, particularly in urban markets with price-sensitive consumers. 

Balance industry growth and consumer interests

With rising costs and shifting consumer priorities, the consumer durables sector is seeking measures that would encourage production and innovation, while protecting consumer and national interests. Industry observers say it’s crucial to ensure that affordability, accessibility and support for local manufacturing remain at the forefront of growth strategies. 

“For the upcoming budget, our industry is closely watching regulatory changes, particularly regarding BIS standards for importing appliances, mainly from China,” highlights Anil Gurnani, Chief Sales & Marketing Officer at TTK Prestige.

He further explains, “It’s crucial to monitor how these standards and BIS licensing evolve for kitchen appliances. The changes should ideally support the Indian industry while ensuring a balanced approach that benefits both consumers and product availability. The government must strike the right balance between industry growth and consumer interests.”

“While the government's ‘Make in India’ initiative has already made significant strides in reducing import dependency and generation of employment, there is scope for further support in the form of subsidies and grants, particularly for MSMEs and smaller manufacturers, to foster local innovation and mass production,” shares a Voltas Ltd. spokesperson.

They add, “This would reduce the increasing costs of imports and local production while inducing global competitiveness for OEMs and large component manufacturers.”

Smart technologies, energy-efficient solutions and skill development are key areas where the consumer durables sector requires innovation — and seeks government support, subsidies and incentives for affordable research and development. 

Encourage year-round spending

With global economic challenges impacting spending on leisure and fashion, industry leaders are urging the government to introduce measures that would facilitate an uptick in demand all year round — without it becoming a financial burden on consumers.

“Given the current state of the global economy and the impact of taxation on taxpayers, there is a sense of hesitation in spending on things like fashion, food, and other discretionary products that previously performed well. The government should consider measures to address this and boost consumer confidence,” says Priyaranjan Manay, Head of Marketing at Pepe Jeans London, adding that the budget should instil confidence in consumers to encourage spending.

Anand Aiyer, CEO, Arrow calls the timing of the budget a pivotal moment to prioritise policies that drive innovation, enhance ease of doing business, and strengthen consumer confidence. “We’re hopeful the upcoming budget will introduce initiatives that foster retail growth and simplify business operations,” he adds.

The industry is also looking for relief, subsidies and incentives for domestic manufacturing, especially sustainable production methods to strengthen India's standing as a world leader in the textile sector in addition to increasing exports.

“Building infrastructure, simplifying e-commerce laws, and investing more in textile workforce skill development initiatives would enable firms to better satisfy changing consumer demands. We anticipate a budget that supports the goal of India being a centre for premium, eco-friendly fashion,” says Jaiwant Singh Dhingra, Director of Marketing and Business Development, Numero Uno.