New Delhi, Jan. 31 -- India's next budget is expected to mark a reset in the government's philosophy towards supporting manufacturing-from offering incentives and protection to fixing the everyday frictions that stop firms from growing, innovating and competing globally, according to two people familiar with the discussions in the government.

Instead of focusing mainly on subsidies or tariff support, the budget is likely to emphasise simpler rules, faster approvals and a more predictable regulatory environment, aimed at helping manufacturers move up the value chain and sell higher-value products in global markets.

According to the first person cited above, who requested anonymity, the government believes manufacturing must do more of th...