Karnataka Budget 2026: Industry Leaders Flag Infrastructure, Skill And Financing Gaps
Industry leaders welcomed measures aimed at improving the ease of doing business and expanding industrial infrastructure, but also pointed to gaps
Published : March 7, 2026 at 5:06 PM IST
By Mohammed Rafiq Mulla
Bengaluru: Chief Minister Siddaramaiah on Friday presented his record 17th state budget, outlining a Rs 4.48 lakh crore spending plan for the financial year 2026–27. He also announced several initiatives to strengthen commerce, industry and micro, small and medium enterprises (MSMEs).
Industry leaders welcomed measures aimed at improving the ease of doing business and expanding industrial infrastructure, but also pointed to gaps related to infrastructure, skill development and financing support for smaller enterprises.
Industrial representatives from the Peenya industrial belt said several long-standing infrastructure issues remain unresolved.
Former president of the Peenya Industries Association, Shivakumar, said key demands of industries in the Peenya industrial area remain unaddressed.
“Stakeholders in the industrial area had expected concrete measures for infrastructure development. But nothing has been spelt out in the budget, leaving all of us hugely disappointed,” he said.
He pointed out that industries have been seeking a common effluent treatment plant for more than 15 years.
According to the association, about 13,500 industries operate across the 50 square kilometre Peenya industrial area, including nearly 800 chemical and electroplating units that require proper waste treatment facilities.
“For more than a decade, industries have been demanding a common effluent treatment plant. Unfortunately, this budget has not addressed that long-pending requirement,” Shivakumar said.
He also said micro and small entrepreneurs expected better support. “The industrial policy mandates allocation of 30 per cent of smaller plots to micro and small entrepreneurs, but it has not been implemented effectively. We had also expected a four per cent interest rate support for KSFC loans, but no funds have been earmarked in the budget,” he added.
Skill development and industry needs
Industrialist Abdul Hafeez, former vice president of the Muslim Industrialist Association, said the budget contains encouraging elements, but greater focus is needed on human resource development.
“At the outset, the budget appears encouraging, but the government must allocate resources for upskilling human resources. Business growth depends on clarity, competence and organisational culture,” Hafeez said.
He noted that competence involves attitude, skill and knowledge and said the current university curriculum is often disconnected from technologies used in real-time manufacturing.
“We need training centres that genuinely build competence in the workforce instead of treating training as a formality,” he said.
Decentralisation and policy reforms
Noorul Ameen, president of the Indian Islamic Chamber of Commerce and Bureau, welcomed the government’s effort to decentralise industries beyond Bengaluru. “Encouraging industries to move outside Bengaluru is a positive step considering the city faces congestion, pollution and talent shortages. However, the incentives offered for relocation could have been more attractive,” Ameen said, adding that better roads and connectivity are essential to build strong industrial ecosystems outside the capital.
Ameen also welcomed the unified business services portal offering more than 100 services across 30 departments and the decriminalisation of 278 provisions across 13 laws to simplify compliance.
“These reforms can help businesses, but the real impact depends on effective implementation,” he said.
Entrepreneur CM Faiz Mohammed said the budget contains several initiatives aimed at strengthening the industry while also highlighting areas that require continued attention.
“The Karnataka Budget 2026 outlines initiatives to strengthen industry and improve the business environment in the state. Measures such as industrial decentralisation and ease of doing business reforms are steps in the right direction. At the same time, their success will depend on effective implementation and continued support for MSMEs, infrastructure development and skill building so that industries can expand and create more employment,” he said.
Industry representatives said the success of the budget’s policy initiatives will depend on timely execution and consistent support for businesses across sectors.
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