Union Budget 2026: Sitharaman announces 'Mahatma Gandhi Handloom scheme', flags reform push in textile industry

Union Finance Minister Nirmala Sitharaman on Sunday asserted that the government focuses on bringing reforms in the textile industry sector and announced the launch of 'Mahatma Gandhi Handloom Scheme'.

Sitharaman, who was speaking while presenting the Union Budget 2026-27, mentioned that the main purpose of 'Mahatma Gandhi Handloom Scheme' is to strengthen the khadi, handloom, and handicraft sectors.

"I propose to set up mega textile parks in challenge mode. I propose to launch the Mahatma Gandhi Gram Swaraj initiative to strengthen Khadi and handloom," Sitharaman said.

The initiative also aims to provide global market linkages and branding support, while streamlining training, skilling, and production quality. It is expected to benefit weavers, village industries, the One District One Product (ODOP) programme, and rural youth.

The Finance Minister proposed an integrated programme with five key components. The first is the National Fibre Scheme, aimed at achieving self-reliance in natural fibres like silk, wool, and jute, as well as man-made and new industrial-age fibres.

The second is the Textile Expansion and Employment Scheme, to modernise traditional clusters by providing capital support for machinery, technology upgrades, and common testing and certification centres.

The third is National Handloom and Handicraft Programme designed to integrate and strengthen existing schemes while ensuring targeted support for weavers and artisans.

FM Sitharaman on Sunday created history by presenting her ninth consecutive Union Budget in Parliament, asserting that the "reform express" of the Narendra Modi-led National Democratic Alliance (NDA) government is well on its way and will continue to maintain momentum to fulfil its duties.

Highlighting the economic performance of the NDA government, Sitharaman said India's economic trajectory since 2014 has been marked by stability, fiscal discipline and sustained growth.

"The reform express is well on its way and will maintain its momentum to help us fulfill our duties. Since we assumed office 12 years ago, the country's economic trajectory has been marked by stability, fiscal discipline, sustained growth and moderate inflation. This is the result of conscious choices we have made even in times of uncertainty and disruptions," said Sitharaman.

She asserted that keeping Aatmanirbharta as a guiding principle, the government has strengthened domestic manufacturing capacity, ensured energy security and reduced critical import dependencies. She added that these measures have delivered a high growth rate of around 7 per cent and enabled substantial strides in poverty reduction and improvement in the lives of the people.

"Keeping Aatmanirbharta as a lodestar, we have built domestic manufacturing capacity, energy security and reduced critical import dependencies. Simultaneously, we have ensured that citizens benefit from every action of the Government, undertaking reforms to support employment generation, agricultural productivity, household purchasing power and universal services to people. These measures have delivered a high growth rate of around 7% and helped us make susbstantial strides in poverty reduction and improvement in the lives of our people," said Sitharaman.

She further stated that the NDA government has decisively and consistently chosen action over ambivalence and pursued far-reaching structural reforms, fiscal prudence and monetary stability, while maintaining a strong thrust on public investment.

"Our government has decisively and consistently chosen action over ambivalence, and we have pursued far-reaching structural reforms, fiscal prudence and monetary stability, while maintaining a strong thrust on public investment," Sitharaman added.

Referring to global challenges, Sitharaman said India is facing an external environment in which trade and multilateralism are under strain. She emphasised that India will continue to take confident steps towards Viksit Bharat by balancing ambition with inclusion.

"Today, we face an external environment in which trade and multilateralism are imperiled. And access to resources and supply chains are disrupted. New technologies are transforming production systems while sharply increasing demand on water, energy and critical minerals. India will continue to take confident steps towards Vikasit Bharat by balancing ambition with inclusion," said Sitharaman.