New Delhi

The Union Budget 2026 is expected to have a moderately positive impact on the fast-moving consumer goods (FMCG) sector, driven by measures aimed at boosting rural income, agricultural productivity and employment generation, according to a report by the State Bank of India (SBI).

The report said several budget proposals are likely to strengthen consumption demand, particularly in rural and semi-urban markets, which are key growth drivers for the FMCG sector.

Among the major initiatives highlighted is the launch of Bharat-VISTAAR, a multilingual artificial intelligence platform that will integrate AgriStack portals and the Indian Council of Agricultural Research (ICAR) package on agricultural practices with AI systems. The move is expected to improve farmers’ access to information, enhance productivity and generate positive spillover effects on rural consumption.

The Budget has also announced the integrated development of 500 reservoirs and Amrit Sarovars to strengthen the fisheries sector. According to the report, this initiative will support livelihoods linked to fisheries and allied activities, thereby improving rural income levels.

To generate quality employment in rural and peri-urban areas, the government has proposed support for the animal husbandry sector through entrepreneurship development, including a Credit-Linked Subsidy Programme, scaling up and modernisation of livestock enterprises. These measures are expected to boost employment and income, supporting demand for FMCG products.

The report also pointed to the Budget’s emphasis on high-value and diversified agriculture, including support for crops such as coconut, sandalwood, cocoa and cashew in coastal regions, agar trees in the Northeast, and nuts such as almonds, walnuts and pine nuts in hilly areas. This focus is expected to improve farm incomes across regions.

Another key proposal is the establishment of Self-Help Entrepreneur (SHE) Marts as community-owned retail outlets within cluster-level federations, supported by enhanced and innovative financing instruments. The report said this could strengthen local distribution networks and improve market access for rural producers.

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Looking ahead, SBI said the outlook for the FMCG sector remains cautiously optimistic, supported by easing food and commodity inflation, improving rural sentiment and steady employment conditions.