Post Budget Reaction Comment by Industry leaders
From Alok Dubey, Chief Financial Officer, Acer India
“The Union Budget unveiled today echoes the government’s objective of “Digital Development” for the country.
It places a high value on technology and innovation as a whole. Realizing the vision of “Make AI in India and Make AI Work for India” is projected to strengthen the country’s standing in the technology industry globally and generate numerous possibilities for the youth. The mention of lowering the minimum TDS threshold and clarifying taxability linked to online gaming is an encouraging step towards gaming industry in India, and it is expected to open up more prospects in the following year. This year’s budget also has prioritised sustainability; this is a step toward a green future that allows businesses and SMEs to enter the market with green products and services; this is a commendable and promising move. Overall, the Union Budget 2023 is promising and represents a significant step toward digital transformation and a holistic sustainable growth.”
Mr. Kshitish Nadgauda, Senior Vice President and Managing Director, Louis Berger WSP.
“We welcome the government’s move of hiking the capital expenditure for infrastructure development by 33 percent to Rs 10 lakh crore. The Union Budget of 2023-24 presented by the Hon’ble FM is progressive, growth-oriented and inclusive with a major focus on infrastructure investment as one of the seven key priority areas for the coming fiscal year and has identified 100 top priority projects. The establishment of an infrastructure finance secretariat will further aid in attracting more private investment and streamlining public-private partnerships. Moreover, the setting up of the Urban Infrastructure Development Fund will provide an impetus to infrastructure development in Tier-2 and Tier-3 cities across the country. This will accelerate the efficient use of land resources, enable adequate resources for urban infrastructure including transit-oriented development, enhanced availability and affordability of urban land, and, most importantly, job creation. It is widely accepted that such investment in infrastructure development especially urban mass transit enables urban centres to flourish and attract quality investment, and result in a vastly improved quality of life for residents.
In addition, there are multiple other infrastructure outlays such as 50 new airports and heliports, coastal shipping, etc. which will enhance intermodal connectivity, which are significant steps in enhancing mass transit. These steps will help in achieving the expected goal of the $5 trillion GDP economy by 2024-25.”
Mr. Ramesh Doraiswami, Managing Director & CEO, National Bulk Handling Corporation (NBHC)
” The Union Budget 2023-24 proposes a continued focus on the key areas of improving farmgate infrastructure and promoting the use of technology to improve farm incomes. The creation of Digital Public Infrastructure for Agriculture is commendable as it will be an open source of information services for crop planning and health, improved access to farm inputs, credit, and insurance & market intelligence, which today are not available readily to farmers thereby limiting their income. The announcement of the Agriculture Accelerator Fund to promote rural entrepreneurship focussed on agriculture is another welcome step. It will be interesting to see the details of this fund since it could also stimulate rural employment. In the “International Year of the Millet”, the announcement to make IIMR Hyderabad a global centre of excellence of millets is a big step forward as well. Overall, the budget presents a positive outlook for the agriculture sector and is likely to have a positive impact on the growth of agri-tech companies.”
Mr. Mahendra Shah, Chairman, and Group Managing Director, V-Trans (India) Ltd.
“The significant progress with many sustainable development goals has increased the Indian economy size from 10th biggest to 5th biggest in last 9 years. The Government has taken several encouraging steps to boost the infrastructure and transportation industry. Logistics, infrastructure, and transportation is the future of our country. This year’s budget has shown the government’s commitment to the logistics and infrastructure sector. This highlights India’s futuristic growth and commitment to elements like the Data Governance Policy, Centres of Excellence on AI, Green Growth, and the conventional thrust areas of infrastructure have also received a big boost. Though the Union Budget 2023 did not provide much specific attention to the logistics and transportation sector. However, the government did announce various initiatives aimed at improving the overall infrastructure of the country, which could have a positive impact on the logistics industry. These initiatives include the allocation of ₹1.97 trillion for infrastructure development, plans to build new airports and modernize existing ones, and investments in the development of the National Highways network. Additionally, the government’s focus on increasing the use of technology in various sectors, including transportation, could also benefit the logistics industry. However, the industry has called for specific measures, such as tax incentives and investment in technology, to boost its growth and competitiveness.”
Mr. Nemin Vora, CEO, Odysse Electric Vehicles.
“With the budget announcement completed, we can see the emphasis on this year’s budget on wider adoption of Electric Vehicles for public as well as private use. The introduction of the National Hydrogen Mission in India is a huge step towards making the country greener and more sustainable.
Government’s decision to increase the income tax rebate limit on personal income from Rs 5 lakh to Rs 7 lakh in the new tax regime is a welcome step for the middle-class citizens. This step is likely to help the sector as more disposable income with salaried customers may give supplementary push to demand for personal vehicles.
Another significant announcement made by the government is the elimination of customs duty on capital goods imported for the manufacturing of lithium-ion batteries. This step is a boost for companies that are / would be manufacturing batteries for electric vehicles locally. Overall, this move by the Government of India is expected to have a positive impact on the lithium-ion battery industry, making it more accessible and cost effective for businesses.”
Mahesh Viswanathan, CFO – Finolex Cables Ltd,
“The Union Budget 2023-24 is forward-looking and positive. It reflects continuity in capital expenditure, which will mean increased growth potential and job creation. The government’s focus on the completion of the rollout of 5G services will increase application possibilities in several fields and this will create a high impact on the demand for communication cables and provide opportunities for companies operating in this sector. Additionally, the government’s focus on the electronics manufacturing sector, through incentives and tax benefits, is expected to boost the production of electronic devices, further increasing demand for communication cables. The budget also focuses on enhancing the ease of doing business where more than 39,000 compliances have been reduced. This is a welcome move for all the operating businesses. The revision of income tax slabs will leave more disposable incomes in hand which will boost the consumer durables sector. Overall, the Union Budget 2023 presents opportunities for the communication cables industry, but the ultimate impact will depend on various factors, such as the implementation of the budget’s proposals and market conditions.”
Mr. Sudhir Pai, CEO Magicbricks.
“The Union Budget 2023 is a bonanza for affordable housing, with the strategic decision to increase outlay for Pradhan Mantri Awas Yojana (PMAY) by 66%! This decision provides the much-needed impetus towards the vision of “Housing for all”. Further, with a 33% increment in infrastructure outlay, the Government is facilitating economic growth through job creation and investments which have direct and indirect impact on the real-estate sector. It is also heartening to see that the government is maintaining its focus on furthering urbanization initiatives, especially with the outlay of INR 10,000 crores per annum for an Urban Infrastructure Development Fund (UIDF) for tier 2 and tier 3 cities. This would certainly give the required boost to the real-estate markets in these cities, which have emerged as real estate growth engines in the past few years. 2022 saw a year-on-year increase in residential demand in cities like Bhubaneswar (12%), Coimbatore (27%), Jaipur (5%), and Nagpur (66%), amongst others, and this initiative will further elevate the livability index and appeal of these cities. Overall, the Union Budget is definitely positive and growth oriented for the real-estate sector”
Mr. LVLN Murty, CEO, Dvara KGFS, Chennai
I congratulate the government for presenting an inclusive budget and underlining the fact that MSMEs are the growth engines of our economy. We welcome the move to enhance turnover limits to Rs 3 crores and Rs 75 lakh respectively for micro enterprises and certain category of MSME professionals to be eligible for presumptive taxation. The Finance Minister’s announcement about a revamped credit guarantee for MSMEs effective from April 1st, 2023, through infusion of Rs 9000 Crore in the corpus is sure to help the ecosystem and open up more credit lines for MSMEs. This will also help NBFCs to bring cost-effective credit underwritings, especially for small borrowers and help to conclude end-to-end digital processing efficiently with standard checks and balances with shorter turnaround time. Focus on sector specific skilling and entrepreneurship development will help rural women gain financial independence. Rural women will stand benefitted if more awareness is created about the opportunities available and about the schemes of the government to support them. Simplification of KYC and making PAN the single identifier for all financial transactions will also help NBFCs like ours to push for financial inclusion across our rural markets.
Mr. Nirav Dalal, Executive Vice President- Business Development and Chief Investment Officer, Shapoorji Pallonji
We welcome the measures announced by Finance Minister Smt. Nirmala Sitharaman in the Union Budget 2023–24, which indirectly aims to boost the real estate sector’s growth while also providing relief to consumers. The proposed increase in the income tax exemption limit to Rs 7 lakh will help boost real estate investment. This tax break will encourage homebuyers to invest more while simultaneously increasing revenue. Meeting the long-standing demand of the real estate sector, the cap deduction for capital gains on residential housing investment is set at INR 10 crore, which will undoubtedly benefit the real estate industry. As one of the important measures to support the market, there has been a 66% increase in the allocation to 79,000 crores in the Affordable Housing Fund (PMAY). The budget also has an emphasis on developing smart cities. The budget has allocated the Urban Infrastructure Development Fund (UIDF), which will be managed by the National Housing Bank and will be used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities. The infrastructural development in these untapped markets will help the development of real estate here.”
Paavan Nanda, Co-Founder, WinZO games.
“It’s heartening to witness TDS for Online Gaming finding significant mention in this year’s Union budget presented by the Hon’ble Minister. The proposed changes lend clarity to the Gaming companies, while creating an airtight accounting system for the exchequer. Aligning it with a player’s Net Winnings in a Financial Year seems like a just provision for the 500MM online gamers in India. Recognising and carving out a separate clause in the act for ‘Online Gaming’ as against gambling or betting is in line with Meity’s recent draft amendment to IT rules for Online Gaming, and is a testimony to the government’s genuine intent to nurture the burgeoning sector. The single most important aspect that the sector awaits clarity on and something that would decide its fate is the outcome from GoM on the GST. We are hopeful that the outcome would retain the current 18% tax slab on gross gaming commissions, and promise to overachieve the $10Trillion economy goal by our Hon’ble Prime Minister well before 2030”.
Mr. R Jeswant, CEO of Funskool India Ltd.
The increase in basic Duty on Toys and parts of Toys (other than parts of electronic toys) to 70% is a boost to Domestic Manufacturers and will help in India developing into a manufacturing hub for toys, as envisaged by our Prime Minister.
Vaidyanathan V, CFO, Great Lakes Institute of Management
We welcome the measures announced by the finance minister in the Union Budget 2023. Setting up of the National Digital Library for children and adolescents will up their knowledge and prepare them for competition at a global level. Emphasis on physical libraries at panchayat and ward levels will make knowledge accessible to children in rural areas and will also open doors for their development. We laud the government’s efforts to come up with three centers of excellence for Artificial Intelligence which are to be set up in top educational institutions. The government’s efforts to recruit more teachers for 740 Eklavya Model Residential Schools is appreciated. However, it is a disappointment that there were no specific announcements for the higher education sector. Research in the higher education sector needs the government’s support which in turn can act as a catalyst for India’s growth. We hope the government opens channels for collaborative working with private institutions as well, to create global managers.
Venkatram Mamillapalle, Country CEO & Managing Director, Renault India
The budget has laid special emphasis on the Vehicle Scrappage Policy which will not only boost the sales but will also enable in achieving clean and green environment for overall sustainable development. Additional, funds infusion in the scrappage policy is a remarkable step and is in the right direction to achieve India’s goal of being carbon neutral by 2070. This policy would eventually help the entire eco-system of automotive industry as this will translate into growing orderbooks of OEMs, increased output and job creation.
Another significant announcement made by the government on the customs duty exemption being extended to capital goods and machinery required for the manufacturing of lithium-ion batteries used in EVs. This step is a boost for companies that are / would be manufacturing electric vehicles locally as it will help reduce the cost of EVs.
The automobile industry will witness an increase in sales with the introduction of new tax rebate limit on personal income which has been raised from INR 5 lacs per annum to INR 7lacs per annum. This step is likely to help the sector as more disposable income with salaried customers may give supplementary push to demand for personal vehicles.
Mr. R. Udayan Lahiry, Co-founder & Managing Director, Medica Group of Hospitals Pvt Ltd
“We welcome the Government’s emphasis on establishing new nursing colleges, as this will improve the nurse-patient ratio and be a positive step toward Universal Health Coverage. Furthermore, making medical research facilities in select ICMR Labs available for research by public and private medical colleges, as well as by the private sector R&D teams for collaborative research and innovation is also a welcome step towards the growth and development of the Indian healthcare sector. It is also encouraging for healthcare service providers to know that the Government has emphasized strengthening the multidisciplinary courses for medical devices in existing institutions since we feel that this will secure the supply of skilled manpower of the future to drive technological advancements in the healthcare sector. Also, the renewed focus of the Government to eliminate Sickle Cell Anemia by 2047 through collaborative efforts of central ministries and state governments is extremely relevant today as it coincides with our country’s firm motto of eliminating infectious diseases like lymphatic filariasis by 2027,.tuberculosis by 2025 and Kala Azar by this year itself. Overall, the union budget has captured a lot of pertinent areas of the healthcare sector and it would have been even more beneficial for the sector if the government would have addressed the mechanism to avail GST input credit.”
Shivaji Waghmare, CEO, Fuji Electric India Pvt. Ltd:
I think Budget 2023 is growth-oriented and it strikes a balance between economic growth and social welfare. It is great news that the budget has provided Rs 35,000 crores priority capital investment towards energy transition and net zero objectives, and energy security. We appreciate the move to extend customs duty exemption to the import of capital goods and machinery required for manufacturing of lithium-ion (Li-ion) cells for batteries used in EVs. This would reduce the production cost and lower the cost of EVs. Manufacturing credit guarantee scheme for MSME is another laudable step. Youth have to be skilled to compete in Industry 4.0 and a lot of measures are being taken to make Indian youth market-ready. More skilling centres would mean more technicians who are very important for industries like us. Reducing the cost of compliances will help reduce the overall cost for the businesses which is a welcome thing. India is going all out to embrace digitalization and also ensure that every segment of its population is taken along in its run towards realising its dream. The increased spends India Railways is a welcome step. I am glad that consumption is being promoted and economy is being revived.
Dr Alok Khullar, CEO, Gleneagles Global Health City, Chennai –
We are delighted to note that the budget session was introduced with the announcement of increase in allocation for Research in the healthcare sector including Pharma, Clinical Research and Public-Private partnership in Healthcare Research. The government’s initiatives to encourage Research and Development in Healthcare is a much-needed move. The collaborative set up of Research and Innovation Centre and the facilities in select ICMR Labs made available for research by public and private medical college faculty and private sector is commendable. Setting-up of more nursing colleges is a welcome move to generate adequate Nursing workforce every year. Introduction of courses for medical devices will fill a significant gap in the industry.
Ketan Kulkarni, Chief Commercial Officer, Blue Dart said, “This Union Budget is an extremely balanced and progressive one with an emphasis on inclusive development. It has a focus on urbanisation and digitalisation. We are delighted to see government’s responsiveness on adoption of green energy, equipment and mobility, which will push the sustainability agenda further. The budget features investments in identified one hundred critical transport infrastructure projects, for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors, these will boost the logistics industry. The INR 75,000 crore investment, including INR 15,000 crore from private sources is a welcome move in this direction. The budget also announced an increase of 33% on Infrastructure development, and a INR 10,000 crore fund allocation to urban infrastructure development. There is also an addition of 50 new airports planned to improve regional connectivity. The Budget also features the highest ever railway outlay of INR 2.40 lakh crore along with proposed Public Private Partnership (PPP) for coastal shipping and transportation needs, to enhance rural connectivity, thus addressing the needs of a rapidly growing economy.”
Mr. Nirav Dalal, Executive Vice President- Business Development and Chief Investment Officer, Shapoorji Pallonji Real Estate
“We welcome the measures announced by Finance Minister Smt. Nirmala Sitharaman in the Union Budget 2023–24, which indirectly aims to boost the real estate sector’s growth while also providing relief to consumers. The proposed increase in the income tax exemption limit to Rs 7 lakh will help boost real estate investment. This tax break will encourage homebuyers to invest more while simultaneously increasing revenue. Meeting the long-standing demand of the real estate sector, the cap deduction for capital gains on residential housing investment is set at INR 10 crore, which will undoubtedly benefit the real estate industry. As one of the important measures to support the market, there has been a 66% increase in the allocation to 79,000 crores in the Affordable Housing Fund (PMAY). The budget also has an emphasis on developing smart cities. The budget has allocated the Urban Infrastructure Development Fund (UIDF), which will be managed by the National Housing Bank and will be used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities. The infrastructural development in these untapped markets will help the development of real estate here.”
Ramanujam Komanduri, Country Manager, Pure Storage India
“The Union Budget presented by the Hon’ble Finance Minister is growth-oriented and inclusive. The impetus for the ‘Digital India’ vision is clear from budgetary allocations across sectors like infrastructure, skill development, sustainability, MSME, and entrepreneurship.
This budget provides numerous growth opportunities for the technology industry by bringing digital solutions and innovation in legacy sectors like infrastructure, manufacturing, education, railways, healthcare, financial services, and regulatory bodies to turn India into a technology-driven, knowledge-based economy. Also commendable is a clear intent and investment in making India a net zero carbon emission country by 2070 through National Green Hydrogen Mission.
Overall, the budget 2023 promises to sustain and catalyze India’s economic and digital growth with a strong role played by technology.”
Dr Saundarya Rajesh, Founder – President, Avtar Group
The Union Budget 2023 by Smt. Nirmala Sitaraman, Honorable Minister of Finance, Government of India presented as the Last Mile Inclusion budget has covered the cohorts such as indigenous tribes, youth, MSME’s, women and senior citizens with a potentially impactful list of benefits being offered to them. The sustainable city program is an applaudable move for it is one of the key inclusion measures required to increase women’s workforce participation. When there is a focus on capital expenditure spending on infrastructure, it is bound to have a ripple effect on women’s employment. As per Avtar’s recent report on Top Cities for Women in India report, more industrial investment in cities result in ecosystem infrastructure improving including day care facilities, commute facilities and medical amenities. This can act as a catalyst to enable women’s employment, thereby improving women’s workforce participation in the country. However, despite our President of India expressing concerns over the skewed gender ratio in economic activity, no specific schemes for the urban working women have been announced. As per the data available, between 2019-20 and 2020-21, rural women’s labour force participation rate (LFPR) increased from 33% to 36.5%, while urban women’s LFPR fell from 23.3% to 23.2%. There has not been a significant rise in this population, a talent segment that contributes significantly to the country’s GDP. If women’s workforce participation has to burgeon, then corporates have to be incentivized to hire and sustain this underrepresented talent pool. The only silver lining is the heavy focus on skilling – the Unified Skilling Platform and its link to MSMEs, a sector that has the potential to boost women’s workforce participation.