CEO of Methods India Calls for Strategic Incentives in Upcoming Budget to Boost Manufacturing

As the countdown to the Union Budget 2026 begins, the domestic manufacturing and capital goods sector is looking for more than just broad subsidies. Jacob Jose, the CEO and Managing Director of Methods India, has emerged as a key voice for the industry, advocating for a strategic shift from generic support to "precision policy" that targets the specific friction points of the engineering sector.

Empowering the 'Make in India' Backbone: Methods India CEO Jacob Jose Lays Out a Vision for Budget 2026

As the countdown to the Union Budget 2026 begins, the domestic manufacturing and capital goods sector is looking for more than just broad subsidies. Jacob Jose, the CEO and Managing Director of Methods India, has emerged as a key voice for the industry, advocating for a strategic shift from generic support to "precision policy" that targets the specific friction points of the engineering sector.

With India's infrastructure momentum in full swing, Jose argues that the upcoming budget on February 1, 2026, must prioritize execution efficiency and cost competitiveness to truly cement India’s position as a global manufacturing hub. This sentiment aligns with broader market analysis suggesting that balancing growth and fiscal discipline is key for the upcoming budget.

1. The Efficiency Manifesto: Clearances and Capex

For large-scale engineering and turnkey projects, time is literally money. Jacob Jose highlights that infrastructure momentum can only be sustained if administrative hurdles are removed.

• Predictable Capex: Jose advocates for five-year rolling capital expenditure frameworks rather than one-year budgetary cycles. This would provide the capital goods sector with the long-term visibility needed to invest in heavy machinery and skilled labor.
• Fast-Track Approvals: He emphasizes the need for a digital single-window mechanism for faster project clearances, ensuring that sanctioned infrastructure projects move from paper to the ground without bureaucratic lag.

2. Rationalizing Costs: The Customs Duty Play

One of the most critical demands from Methods India is the rationalization of customs duties. In an era of fluctuating global commodity prices, the cost of raw materials can make or break an engineering firm’s margins.

• Inverted Duty Fix: Jose suggests correcting inverted duty structures where raw materials are taxed higher than finished imported goods, which currently penalizes domestic value addition.
• Targeted Exemptions: He calls for lowering duties on essential components that cannot yet be manufactured at scale within India, helping firms manage costs while they build local capacity. This is expected to be a key sector reform anticipated in the upcoming Union Budget 2026-27.

3. Scaling Responsibly: Incentives for Capacity Expansion

Rather than broad subsidies, Jose is pushing for targeted incentives that reward companies for scaling up their physical and technological infrastructure.

• Capacity Creation: Incentives linked to the creation of new fabrication facilities and the localization of critical components.
• R&D and Tech Upgradation: Reintroducing weighted tax deductions for R&D (such as the 200% deduction) to encourage innovation in areas like energy-efficient bulk material handling and digital monitoring.

4. Solving the Cash Flow Crunch

A recurring pain point for Indian engineering firms is the delay in payments from public sector projects. Jose highlights that timely payments are "vital" for maintaining the liquidity required to execute large-scale, multi-year contracts. He suggests that the budget should introduce performance-related payment milestones that are strictly adhered to by government agencies.

Looking Ahead: Building the Industrial Backbone

The "Methods India" vision for Budget 2026 is clear: the government should shift focus from "Asset Creation" to "System Efficiency." By improving the ease of doing business and lowering logistics costs through better port and rail connectivity, the government can help domestic firms move up the value chain from mere fabricators to end-to-end solution providers.

FinScann Take:

Jacob Jose’s recommendations reflect a mature manufacturing sector that is ready to compete globally but needs the "shackles" of administrative delays and cost inefficiencies removed. If the Union Budget aligns with these goals, the capital goods sector could see its strongest growth cycle in a decade.