Budget 2026: What India’s FMCG brands want and what it could mean for ad spends

New Delhi: If you ever want to understand India’s mood, don’t look at stock charts. Look at what people are putting in their shopping baskets.

A little extra shampoo. A bigger pack of biscuits. A new flavour of chips. A slightly fancier face cream. A brand switch from the cheapest option to the one that feels “worth it”.

That tiny upgrade is where India’s FMCG story lives. And that is exactly why the Union Budget 2026 matters so much to this sector.

For FMCG brands, the Budget is not just a government event. It is a national mood setter. It can decide whether households feel confident enough to spend, whether rural demand stays steady, whether input costs behave themselves, and whether brands can plan beyond the next quarter.

And if demand looks stable, FMCG brands don’t just sell more. They advertise more too. Because nothing says “we are feeling confident” like a brand launching a new campaign, splashing across TV, going big on digital, and chasing consumers everywhere from Instagram reels to kirana shelves.

So what are India’s FMCG leaders expecting from the Union Budget 2026? And how could it reshape FMCG advertising and AdEx? 

Consumption first, always

The loudest expectation from FMCG is also the simplest one. Keep consumption healthy, moving, and predictable. 

Mayank Shah, Vice President, Parle Products, said, “As the FMCG sector looks to the Union Budget, our key expectation is sustained policy support to strengthen consumption across urban and rural India.” 

He pointed out that recent volume growth showed resilience even when trade disruptions were in the air. “Measures that boost disposable incomes, improve infrastructure and farm or Agri reforms resulting in stable commodity prices will be critical to maintaining this momentum,” he told BestMediaInfo.com.  

That is FMCG in one sentence. If disposable income rises and essentials stay stable, people buy. When people buy, brands compete harder. And when brands compete harder, advertising gets louder.

The FMCG sector also knows the last few years have trained consumers to be careful. People have learnt to cut back quickly. They can downgrade packs, reduce frequency, and delay non-essential purchases without much warning. So, for brands, demand stability is not a nice bonus. It is the foundation.

GST is still the big headline behind the headline

Ask FMCG leaders what could unlock more consumption, and GST shows up almost immediately.

Sudhir Sitapati, MD and CEO of Godrej Consumer Products Limited, said, “Our main expectation from the Budget is efficient measures to boost consumption, particularly through further rationalisation of GST.” 

He pointed to a very specific pain point that affects mass categories. He said, “There are a few large, mass-consumption FMCG categories, especially in home care, that continue to be taxed at 18 per cent and could logically move to a lower slab such as 5 per cent to support demand.”

It is a strong ask, but it is also logical for the FMCG sector. When taxes are high, prices remain high, and consumers become more value-conscious while making purchase decisions.

Sitapati also looked beyond taxation and into execution. He said, “We also believe that higher allocations for infrastructure linked to labour- and water-intensive categories should be released in a timely manner.” 

And he balanced optimism with realism. “That said, the sector has already seen significant stimulus over the past year, and continued focus on consumption will help sustain growth,” noted Sitapati. 

Rajiv Kumar, Vice Chairman, DS Group widened the conversation from consumption to competitiveness. He said, “We extend our sincere gratitude to the Government for the strategic tax reliefs provided to the FMCG sector; these measures have been instrumental in driving a visible recovery and fuelling a robust resurgence in consumer demand across the nation.” 

He added, “It will be helpful if the upcoming Union Budget continues to focus on a consumption-driven framework that strengthens affordability and market access.”

But DS Group also wants the Budget to go deeper into manufacturing support. Kumar stated, “We request for targeted manufacturing support to bolster the "Make in India" mission.” He laid out what that support could look like, saying, “This can be achieved by facilitating measures such as capital subsidies and land at concessional rates to bolster rural production and consumption, alongside providing critical tax relief through Input Tax Credits.”

And in a very FMCG-meets-global-ambition moment, he added, “To maximize the growth of the FMCG sector, we request the government to implement a comprehensive support framework that helps Indian companies going global to successfully navigate the complex global environment and set up robust presence across the globe.”

That line matters because FMCG in India is no longer only about India. Brands want scale. They want exports. They want international playbooks and policy support can speed up that journey.

Marketing confidence equals predictability

If FMCG had a love language, it would be ‘predictability.’

Brands can deal with slow growth. They can deal with tough competition. But uncertainty is the real budget killer.

Shah explained what will give brands the confidence to spend on marketing. He said, “Marketing confidence in FY27 will be driven by demand consistency and visibility.” 

He pointed to a positive base in the market, saying, “The narrowing urban–rural gap post-GST and steady volume growth provide a positive base, and continued consumption-led policies can encourage brands to invest more confidently in long-term brand building and premiumisation.”

This is where the Budget becomes more than a finance document. It becomes a signal. A signal that tells FMCG companies whether they should play long-term, build brands, and invest in premiumisation, or stay tactical and cautious.

Akash Agrawalla, Co-founder and Director, Zoff Foods, also linked marketing confidence to stability. He said, “What will meaningfully unlock marketing confidence in FY27 is predictability.” 

He explained it in a way every marketer understands. When brands see “sustained demand, stable input costs, and clarity on GST or compliance norms,” they stop treating marketing like a tap they turn on and off. Instead, they commit, plan, and build. 

Agrawalla said, “For the FMCG sector, our key expectation from the Budget is continued focus on consumption revival, especially through higher rural spending, income support, and lower inflationary pressure on essentials.” 

Food and essentials want supply chains to behave

If you are into food, spices, and essentials, you know one thing. Even the best campaign cannot compensate for an unstable supply chain.

Agrawalla said, “For food and spice brands like ours, stability in agri supply chains, cold storage infrastructure, and logistics costs directly impacts pricing and margins.”

That is a very real FMCG problem. Logistics plays a direct role in keeping products affordable. Cold storage helps maintain steady supply and when supply is stable, brands can plan promotions, pricing, and media spends with fewer surprises.

Personal care wants a smoother GST runway and stronger channels

Personal care brands are watching two things closely. Profitability and distribution.

Sunil Agarwal, Co-founder and Chairman, Joy Personal Care, said, “As we approach the Union Budget 2026, we remain positive with expectations of policies that not only sustain the current recovery in consumption but also unlock the next wave of growth for the FMCG sector.” 

He described the sector’s current mood, saying it entered the year with “positive momentum with early signs of consumption recovery, driven by easing inflation, improved affordability through tax reforms, and steady demand growth across both rural and urban markets.”

He also linked premiumisation to policy support, saying, “As consumer preferences evolve and premiumisation gains traction, supportive policies will be key to accelerating demand.”

On GST, Agarwal said, “A more balanced and consistent GST structure for personal care products, will play an important role in improving profitability while allowing companies to continue offering high-quality products at affordable prices.” 

He also pointed to channel growth, saying, “At the same time, e-commerce and modern trade have a strong opportunity to grow further, supported by increasing digital adoption and more efficient, integrated supply chains.”

That is the FMCG growth map right now. Traditional retail remains the muscle. But e-commerce and modern trade are becoming the speed boosters.

Homegrown brands want ease, clarity, and fewer compliance headaches

Alongside large FMCG players, many brands are steadily scaling and building stronger presence across regions. For them, policy clarity can be the difference between growing steadily and getting stuck.

Ishita Malpani, Managing Director, Amruta Tea, said, “As the FMCG sector navigates a shifting consumption landscape, we look to the Union Budget 2026 to catalyse renewed demand across both urban and rural markets.” 

She added, “Targeted fiscal support that enhances disposable incomes through tax reforms and clarity in GST implementation will be crucial for stimulating consumer spending and improving affordability.”

She also spoke about the backbone of consumption growth, saying, “Continued investment in rural infrastructure, supply chain modernisation and logistics will not only expand market reach but also strengthen the backbone of India’s consumption story.” 

“Additionally, measures that reduce the compliance burden and foster ease of doing business will empower homegrown brands to innovate and scale,” she adds. 

Malpani summed up the mood with optimism. She said, “We are optimistic that the Union Budget 2026 will reinforce growth continuity, support sustainable consumption and unlock meaningful opportunities for the FMCG ecosystem.”

Now the big question is what happens to FMCG advertising?

Here is where things get fun. Because FMCG advertising is not small, subtle, or shy.

It is one of the biggest wallets in Indian ad spends. It shows up everywhere. On television, on YouTube, on cricket broadcasts, on Instagram reels, on metro stations, on e-commerce apps, and on the side of your favourite delivery bag.

And the scale is not theoretical. In FY2025 alone, the ad and promotion spends disclosed by a set of the biggest FMCG advertisers added up to about Rs 10,077 crore, led by HUL at about Rs 6,199 crore, followed by players such as Marico at about Rs 1,128 crore and GCPL at about Rs 1,369 crore, along with Colgate, Emami and Dabur. 

That is only a slice of the market, but it shows how large the FMCG advertising wallet already is even before you add the rest of the category. FMCG is also one of the most competitive categories. Brands are not just fighting for consumers. They are fighting for habits. For shelf space. For top-of-mind recall. For that one second when someone reaches for a product and chooses their brand instead of the other one.

So when the Budget supports consumption, it can expand FMCG AdEx in a very direct way.

Clearing this up, Shah said, “We expect Budget-led demand to translate into incremental advertising spends rather than mere reallocation, as brands compete for growth and differentiation.” 

Agrawalla echoed the same belief. He said, “I believe any Budget-led demand uptick will initially result in incremental AdEx rather than mere reallocation.” But he also added the reality check that modern marketing teams live with. 

He said, “However, this incremental spend will be performance-led and outcome-driven. Brands today are cautious and expect measurable ROI from every rupee spent.”

Digital will get a bigger bite, but TV stays powerful

If consumption improves after Budget 2026, FMCG will likely push harder across both mass and targeted channels.

Parle’s Shah observed, “Digital platforms are well positioned to benefit due to their targeted and regional reach, while television will continue to play a key role in driving mass awareness.”

Agrawalla also broke down the platform impact in a very 2026 way. He said, “In terms of platforms, digital, especially video, regional content, and commerce-linked media, will benefit the most. At the same time, television continues to play a strong role in building mass trust for FMCG brands, particularly in food categories.”

This is the new FMCG playbook. Not digital versus TV. It is digital plus TV. And the mix keeps getting sharper.

Agrawalla called it perfectly when he had said, “The winning mix will be omnichannel, but sharper, more data-backed than before.”

What Budget 2026 can really do to FMCG AdEx

If the Budget does three things, FMCG advertising could get a real push.

One, it can improve affordability and demand through tax reforms and GST rationalisation. That directly lifts volumes and gives brands confidence.

Two, it can support infrastructure, rural spending, and supply chain stability. That reduces shocks and improves predictability.

Three, it can reduce compliance friction and support manufacturing. That frees up resources and improves long-term competitiveness.

If these pieces fall into place, FMCG brands will likely spend more on advertising, not just to sell more, but to win more. And FMCG does not like to win quietly.

It likes to win loudly, with a catchy jingle, a familiar face, and a campaign that follows you from TV to phone to store. In the end, the Union Budget 2026 may not decide which biscuit you buy next week. But it will decide the mood in which you buy it. And for FMCG, that mood is everything.