The announcement of the Union Budget 2025 has garnered notable attention across various sectors, with the real estate manufacturing industry closely monitoring its impact. Real estate manufacturing includes producing essential materials and components used for construction, including cement, steel, tiles, windows, doors, and prefabricated building elements. The industry reacted positively to the Union Budget 2025 introduction of several initiatives to strengthen India’s manufacturing sector through enhanced infrastructure and business reforms.
Key Budget Initiatives For Construction
National Manufacturing Mission: The mission aims to support small, medium, and large industries under the “Make in India” initiative.
Urban Challenge Fund: Rs 1 lakh crore fund to support 25% of the cost of bankable projects in urban development.
SWAMIH Fund-2: Rs 15,000 crore fund to complete 1 lakh housing units in stressed projects.
Jal Jeevan Mission: Extended to 2028 with a focus on the quality of infrastructure and operation and maintenance of rural piped water supply schemes.
National Geospatial Mission: Develop foundational geospatial infrastructure and data to benefit urban planning.
BharatTradeNet: A unified platform for trade documentation and financing solutions for international trade.
National Framework for Global Capability Centres (GCCs): It will boost tier-II cities infrastructure and foster industry collaboration.
National Manufacturing Mission
The manufacturing industry welcomed the government’s vision to support the MSMEs and its emphasis on infrastructure as it sets its sights on growth, sustainability, and infrastructure development. The introduction of the National Manufacturing Mission marks a significant step in India’s ambition to become a global manufacturing hub. The mission’s broader vision spans five critical areas, such as simplifying business operations, providing upskilling opportunities for a new workforce, maintaining support for MSMEs, ensuring access to cutting-edge technologies, and promoting the production of high-quality goods. These focus areas aim to create a thriving ecosystem where Indian companies can succeed and compete globally.
Rajesh Shah, Chairman & Managing Director, Euro Panel Products Limited, believes the inroads made at the Union Budget 2025 uniquely positions the Indian manufacturing, construction and building materials industries for robust growth. Shah said, “The introduction of the National Manufacturing Mission will India’s commitment to becoming a global manufacturing leader. Also, setting up an Urban Challenge fund worth Rs 1 lakh crore to redevelop cities positions the building materials and construction industry in a favourable position. The emphasis of each infra ministry to come up with a 3-year list of PPP projects will be an era-appropriate move, furthering the National Manufacturing Mission and Make in India initiatives. These will enable industry stakeholders to scale operations, enhance efficiency, and drive innovation, directly translating to India attracting greater investments, creating high-value jobs, strengthening supply chains and boosting export.”
Voicing the same, Ridhima Kansal, Director, Rosemoore, said, “The new manufacturing mission’s all-inclusive strategy catering to all business sizes signals a major advancement in the Make in India policy. Achieving this goal will make India one of the leading nations in green manufacturing and boost new technologies such as solar PV cells, electrolysers, and grid-scale batteries. This will assist in creating an integrated supply chain in the country’s small, medium and large industries.”
Lalit Beriwala, Director of Shyam Steel Industries Ltd, viewed the budget’s focus on manufacturing sector as forward looking and resilient. “This budget, which rests on the pillars of agriculture, MSME, investment, and exports, promises to accelerate India’s journey toward becoming a Viksit Bharat. The emphasis on inclusive growth, skill development, infrastructure expansion, and innovation is a testament to the government’s commitment to economic development. We are particularly encouraged by the provisions for MSMEs, rural development, and substantial investments in urban rejuvenation, which will foster industry growth and create abundant employment opportunities across the country. As we continue to strengthen our core industries, this budget’s focus on sustainability, technological advancement, and empowering the youth will have a transformative impact on the economy, taking India a step closer to achieving its vision of a prosperous and inclusive future.”
National Manufacturing mission’s focus on supporting industries of all sizes, from small and medium enterprises to large corporations, will encourage building products and construction materials manufactures and provide ease of doing business.
Urban Development
Focusing on urban infrastructure development and housing, the government announced an allocation of Rs 1.5 lakh crore in 50-year interestfree loans to states for capital expenditure, aiming to boost urban infrastructure, indirectly benefiting the manufacturing sector by improving logistics and connectivity. Additionally, establishing an Urban Challenge Fund of Rs 1 lakh crore to transform cities into growth hubs is anticipated to stimulate demand in real estate.
The Cement Manufacturers’ Association (CMA) has welcomed the Union Budget 2025-26, lauding its focus on infrastructure development, housing, and economic expansion. Neeraj Akhoury, President, Cement Manufacturers’ Association (CMA) and MD, Shree Cement Ltd., stated, “This Budget, announced under the leadership of Hon’ble Prime Minister Shri Narendra Modi, marks a significant step toward holistic and inclusive development. The government’s focus on infrastructure expansion will unlock tremendous opportunities for the cement industry. Increased investments in highways, railways, and urban infrastructure will stimulate demand for construction materials, allowing the sector to expand its capacity while embracing sustainable innovations.” He further noted that the continued emphasis on large-scale housing projects and core infrastructure will help the Cement Industry achieve a stable CAGR growth of over 6% in installed capacity this fiscal year.
Sharing his thoughts on the Union Budget 2025, Raghunandan Saraf, Founder and CEO, Saraf Furniture, said, “This mission demonstrates a tremendous shift in the manufacturing policy framework of India. Focusing on renewable energy components such as solar PV cells and grid-scale batteries complements global sustainability initiatives. Additionally, this policy will further enable the country to create a self-sufficient manufacturing industry.”
To boost economic activity in small metros, the Union Budget 2025 has introduced a National Framework for establishing Global Capability Centres (GCCs) in tier-II cities. This initiative aims to enhance talent availability, improve infrastructure, reform building bylaws, and foster industry collaboration.
India is rapidly emerging as a hub for GCCs, with over 1,700 centres spread across the country, employing nearly 1.9 million professionals. The government focuses on tier-II cities to create more balanced growth, encouraging economic activity to move beyond metros. This push aims to reduce congestion in major cities while fostering development and job opportunities in smaller urban centres, helping to boost regional economies and create a more equitable growth story.
In his reaction, Rakesh Zutshi, Managing Director, Halonix Technologies, noted, “The government’s push to enhance infrastructure and establish a national framework for global capability centres (GCCs) in tier-II cities is an exciting development.
This initiative will boost talent availability, infrastructure, and industry collaboration, fostering innovation in energy-efficient lighting and electrical solutions.” “The 2025 Union Budget focuses on strengthening India’s manufacturing sector, particularly electrical products. The government’s push to enhance infrastructure and establish a national framework for global capability centres in tier-II cities is exciting. This initiative will boost talent availability and infrastructure and facilitate collaboration between industry and states, fostering innovation in energy-efficient lighting and electrical solutions. Equally importantly, income tax benefits kickstart consumption or savings. Both are desirable outcomes.”
The Water Sector
Furthermore, the government’s push to extend its ‘Har Ghar Jal’ program under the Jal Jeevan Mission (JJM) until 2028. The ambitious initiative aims to provide clean and safe drinking water to every rural household nationwide. It will continue expanding for another three years, ensuring millions more households access this essential service. The ‘Har Ghar Jal’ program, initiated in 2019, has made a significant stride in ensuring that drinkable water is available at every individual’s doorstep, particularly in rural and remote communities. The mission has been essential to the government’s efforts to improve life quality and infrastructure.
The ‘Har Ghar Jal’ program extension until 2028 will allow the government to increase efforts, focusing on infrastructure improvements, water supply system maintenance, and water resource sustainability. With a renewed emphasis on community participation, the initiative will ensure that local systems can manage and maintain water infrastructure long-term.
Voicing his thoughts on the water sector fund, Saurabh Dhanorkar, Managing Director, Finolex Industries, said, “The Union Budget’s strong emphasis on infrastructure development, particularly through the extension of the Jal Jeevan Mission until 2028, reflects a firm commitment to sustainable water management and rural development.
The focus on enhancing the quality of infrastructure and improving the operation and maintenance of rural piped water supply schemes through Jan Bhagidhari is a critical step toward ensuring long-term water security. The signing of separate MoUs with states and UTs to promote citizen-centric water service delivery further reinforces this commitment.
Additionally, initiatives like Prime Minister Dhan Dhanya Krishi Yojana, aimed at improving irrigation facilities, will indirectly support the growth of water infrastructure across agricultural regions. Together, these measures create significant opportunities for the piping industry to contribute to developing robust, sustainable solutions that will benefit both rural communities and the broader infrastructure ecosystem.”
Gurmit Singh Arora, National President of the Indian Plumbing Association, observed, “The plumbing sector gets a substantial boost with the current target of extending portable water supply connectivity from 15 crore households across India to 100 crore households under the extended Jal Jeevan Mission. The rising emphasis on highgrade infrastructure will require skilled labour and modern plumbing materials. It is not as simple as just piping India’s water sources. Rather, it is about developing comprehensive systems that sustainably and efficiently deliver water for years into the future. Growing from the present 80 per cent achievement towards universal coverage will mean more spending in modern plumbing and construction and many job opportunities for contractors and plumbers. Increased competitiveness in infrastructure will necessitate positively modernised plumbing practices throughout the industry.”
The Union Budget 2025 has been hailed as a transformative step for India’s manufacturing and infrastructure sectors, with key investments to drive economic growth and sustainability. The budget presents a forward-looking vision that aligns with the aspirations of businesses across industries, laying the foundation for an economy that is growing and becoming more resilient and globally competitive. The strategic investment in infrastructure and manufacturing is poised to unlock new opportunities, drive regional development, and strengthen India’s position on the global stage.
Budget Impact On Construction Industry
1) Drive higher demand for steel, cement, and construction services
2) Create a surge in business opportunities for AEC (Architectural, Engineering & Construction) segment
3) Support to real estate will create more opportunities for product manufacturers
4) Growth of Tier-II cities will drive demand for construction equipment & materials
5) Boost to construction firms for long-term competitiveness
