Urging corporate leadership to avoid designing “only for the formal urban elite”, Union Finance Minister Nirmala Sitharaman on Tuesday said if corporates pursue “premiumisation for the urban tier alone, growth will lose its structural durability”. Sitharaman said the country stands at a structural inflection point and the next phase of consumption will be driven by upward mobility into higher-income brackets where there is more discretionary spending.She pointed out the changing demographics of the population stating that with a rising median age, lower youth dependency and greater longevity will move household budgets toward healthcare, personal wellness, consumer durables, and quality services.“India’s consumption base rests on working families across agriculture, rural construction, transport, and informal enterprise. If corporate India pursues premiumisation for the urban tier alone, growth will lose its structural durability,” she said at the Platinum Jubilee Convention of the All India Management Association (AIMA).As the government opens up sectors such as space and nuclear energy to greater private participation, more of India’s development needs can be met through the market — and industry must step forward to meet them, she added.Also Read | ‘After BA, you go for MA. Then?’ Nirmala Sitharaman on degrees, job marketPrivate Final Consumption Expenditure (PFCE) — which accounted for 55.6% of India’s GDP in the first quarter of 2026-27 in current prices — posted a real growth rate of 7.1% in April-June, up from 6.8% a year ago.Sitharaman also highlighted the need to focus on “quality” across factories, boardrooms, research and development, adding that it must become the country’s next national movement. “India’s next phase of growth must be built on quality. Every factory floor, boardroom, service centre, R&D team, etc. must aim for higher standards, fewer defects, and greater reliability. Management professionals and corporate leaders should make quality consciousness a shared discipline, embedded in products, processes, services and institutions,” she said.India’s gross expenditure on R&D stands at 0.83% of GDP, far below the 2.7% average of OECD (Organisation for Economic Co-operation and Development), 2.6% of China, and 3.5% of the US, reflecting a persistent shortfall in private-sector R&D depth, where the domestic private sector contributes just 36% compared to over 70% in leading advanced economies, Sitharaman said.Story continues below this ad“Therefore, corporates need to spend more on R&D, either in-house or through collaboration with academia. This will help in driving innovation and improving existing products,” she added.Also Read | Finance Minister Nirmala Sitharaman: Not just host GCCs; maximise innovation, accelerate discoveryHigher R&D expenditure should also translate into more intellectual property being created in and from India, she said. “Manufacturing scale is important, but the next stage is to capture more of the value that comes from design, engineering, patents, software, technology and know-how. Our ambition must move from ‘Made in India’ to ‘Imagined in India’ — products not only manufactured here, but conceived, designed and technologically developed here, and then taken to markets across the world,” the minister said.Talking about corporate governance, Sitharaman said businesses must engage constructively with the government and regulators. “Legal recourse will always remain available, but every disagreement need not begin as litigation. There is considerable value in engaging early, placing evidence on the table, participating seriously in consultations and working towards solutions before differences become disputes,” she said. Underlining that businesses must provide predictability, transparency and a willingness to listen, she said a mature economy should be capable of disagreement without immediately becoming adversarial.Referring to the institutionalisation challenges for India’s family businesses, Sitharaman said a large share of India’s MSMEs and mid-sized enterprises are family-owned. Even though many have strong products, loyal customers and significant growth potential, she said their expansion can be held back by unclear roles, succession disputes, informal decision-making and disagreements within the family. “The challenge is often not entrepreneurship, but institutionalisation. We need professionalisation: separating ownership from management, defining responsibilities, preparing the next generation, and resolving conflicts before they affect the business itself.”