The recommendations include recognising food and beverage (F&B) retail as a priority and essential service, expediting formulation and implementation of the National Retail Policy
Emphasising that the retail sector can provide a substantial impetus to growth with the right policy support, Retailers Association of India (Rai) has highlighted 10 key recommendations through pre-budget memorandum 2025–26.
The recommendations include recognising food and beverage (F&B) retail as a priority and essential service, expediting formulation and implementation of the National Retail Policy and extending all micro, small and medium enterprise (MSME) benefits to retail and wholesale traders. The industry body has urged the Centre to Provide 150 per cent depreciation on new capital investments with accelerated timelines and promote digital transactions through merchant discount rate (MDR) waiver/subsidised MDR.
Boosting Retail And Consumption
To ensure sustained growth, the Union Budget must focus on stimulating demand and consumption. The industry body noted that lower personal taxes and targeted reliefs will increase monthly disposable income, boost consumer sentiment and directly support retail growth.
Highlighting that Retailers, especially MSMEs and independent traders, face high borrowing costs, Rai has vouched for a special budgetary announcement for lower-interest financing for retailers and creation of a dedicated retail/trader finance scheme through Small Industries Development Bank of India (Sidbi). The industry body has also urged for allocation of a special fund for retail MSMEs and relaxation of select lending norms to improve credit access.
Noting that the F&B retail sector should be recognised as a priority and essential service, Rai has urged the Centre for preferential land rates, subsidies on utilities such as electricity, policy support similar to other essential services.
National Retail Policy
Rai urged the government to expedite the formulation and implementation of the National Retail Policy. A unified policy framework will reduce regulatory complexity, improve ease of doing business, encourage investment and support both modern and traditional retail, the association pointed out.
While retail and wholesale trades are included under MSMEs and allowed Udyam registration, benefits are currently limited to priority sector lending. Rai recommended that retail and wholesale MSMEs must be made eligible for all MSME benefits, at par with other sectors. On the modernisation front, the body recommended subsidised or reimbursed point of sale (POS) systems for small retailers, certification of secure, compliant POS hardware and software.
Highlighting that the Model Shops & Establishments Act, 2016 is a progressive reform, the industry body pointed out that while states like Maharashtra and Gujarat have aligned their laws, the Centre must incentivise and encourage other states to adopt the Model act. An initial rollout of 25 lakh EDC machines can significantly boost goods and services tax (GST) registration and formalisation, it added.
Rai urged the Centre to reintroduce the EPCG Scheme for the retail sector to support modern infrastructure creation. The body has requested the government to extend concessional duty benefits under EPCG.
