Why this is important to Wisconsin businesses: Wisconsin companies from a wide range of industry sectors can take advantage of easier tax and tariff rules in their exports to India.
India’s budget for 2025-2026 calls for unlocking the nation’s “tremendous potential for greater prosperity and global positioning.”
India’s finance minister Nirmala Sitharaman presented the budget proposal in February 2025 and said the goals include eliminating poverty, providing high-quality education and health care, offering meaningful employment for all, and empowering farmers to make the country the “food basket of the world.”
Plans include expanding broadband, establishing a project for developing small nuclear reactors, providing loans to more women and first-time entrepreneurs, and adding 75,000 seats in medical colleges and hospitals over the next five years, according to PRS Legislative Research.
The budget also focuses on boosting domestic manufacturing, promoting exports, and nurturing innovation, according to PricewaterhouseCoopers (PwC). A new tax law is expected to be introduced soon, providing tax simplification, reduced compliance burden, and ease of doing business.
There is no change in the basic tax rate for Indian or foreign companies, PwC said, but duty concessions will be provided for goods and raw materials that are meant for manufacturing in India.
To boost the startup ecosystem in India, a tax holiday will be available if eligible start-ups are incorporated before April 1, 2030—an extension from the current deadline of April 1, 2025.
Tariff rates are being reduced for a wide variety of imports, such as motor vehicles, solar cells, laboratory chemicals, and components of electronic toys.
India’s economic growth is expected to moderate to 6.4% in fiscal 2025 compared to 8.2% growth in FY24, mainly due to a slowdown in urban consumption, high inflation rates for food, slow growth in capital formation, and global headwinds, PwC said. However, India is expected to remain the world’s fastest growing economy in 2025, supported by a strong domestic market, rising working age population, and strong macroeconomic fundamentals.
Wisconsin companies considering exporting their goods and services to India may see benefits from the provisions included in the new budget.
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