New Delhi, July 5 (KNN) Union Budget 2019-20 had announcements for different industrial sectors of the economy. KNN India has the reactions from experts from across the sector.

Insurance Industry

Sumit Rai, MD & CEO, Edelweiss Tokio Life Insurance

The proposed 100% Foreign Direct Investment in Insurance Intermediaries will have a positive impact on customers, intermediaries and the sector.  Insurance distribution is an upfront-capital intensive business with a long gestation period,  and given low insurance penetration in India, there is a significant need to strengthen existent distribution networks. The proposed 100% FDI, coupled with a strong India growth story, will enable intermediaries to expand faster in non-urban markets, deepening insurance penetration in the country.

This move will also help reform existing customer practices by leveraging global best practices and elevating customer experience in India, as far as insurance is concerned.

 

Mutual funds industry

Radhika Gupta, CEO, Edelweiss Asset Management

Coming on the back of very high expectations, the budget covered a wide range of issues from infrastructure and disinvestment to electrical vehicles, education and start-ups.  Disinvestment is a stated priority, and extending tax incentives to retail investors in CPSEs oriented ETFs will provide a big push to this category, hopefully both for equity and debt ETFs.  The re-iteration that NBFCs are a cogwheel of the Indian economy, and incentivising PSBs to buy assets from NBFCs will ease the current credit environment which is positive for debt mutual funds.  The government also emphasized the need to deepen the corporate bond market, and encourage retail participation in debt, which has been limited so far.

Disclaimer: Ms. Radhika Gupta is the Chief Executive Officer of Edelweiss Asset Management Limited (EAML) and the views expressed above are her own.

 

NBFC Industry

Rajesh Sharma, Managing Director, Capri Global Capital Limited.

“The government has set up very strong reforms to encourage the MSME business. The new policy Pradhan Mantri Karam Yogi Man Dan Scheme will not only boost the economy but will also encourage self-reliance among the MSME community.

We believe that women are the real agent of change in the society and lack of access to credit should not deter them, providing them with a loan up to Rs 1 lakh under Mudra Yojana  is a great initiative to promote women empowerment.

Government’s one-time six-month credit guarantee for the purchase of assets of high rated NBFCs up to Rs. 1 lakh crore is a clear direction to the banking and NBFC sector of the Government’s commitment to resolving the crisis.

Moreover, by allowing FII's and FPI's to invest in debt papers of NBFC's will create and give a boost to the much-needed liquidity to the NBFC's. This may eventually help ease out the liquidity crisis in the real estate sector among other businesses.

A great step towards Housing for All by 2022 by increasing the interest deduction up to Rs 3.5 lakh for affordable housing as against Rs 2 lakh earlier. This will definitely ensure that every Indian citizen is closer to achieve their dream of owning their house.

The Union Budget 2019 has taken care of all majority reform and we look forward to the continued period of high growth for the Indian economy.”

 

Education Industry

Sadiq Sait, Founder and CEO, uLektz Learning Solutions

We are pleased with the Government’s effort to increase efforts to improve the skills of our youth in newer areas such as Artificial Intelligence, Big Data, Robotics, etc.

The government’s Kaushal Vikas Yojana is a good initiative for the country’s youth to take up industry-relevant skill training and bodes well with uLektz’s mission to address the crucial issue of unemployment and underemployment. The proposal of 'Study In India' scheme will further aid the growth of the higher-education. Furthermore, to have a television channel exclusively for start-ups, will help to promote entrepreneurship, funding and tax planning.  One of the main challenges plaguing the start-up industry is the lack of funding. Now, with the government’s initiative to resolve the angel tax issue by removing the scrutiny on start-ups and by extending the period of exemption for capital gains tax, there would will be good impetus for accelerated growth and hassle-free conduct of business for start-ups in the country."

 

Real estate Industry

T Chitty Babu, Chairman and CEO, Akshaya Pvt Ltd

We congratulate Ms. Nirmala Sitharaman on her maiden budget speech in the Parliament today. The proposal to provide a deduction of Rs. 1.5 lakhs in addition to the existing Rs 2 lakhs for residential homes of up to Rs. 45 lakhs will be seen as a major boost to the real estate sector in the country. Though the income tax deduction proposal is for the current fiscal, we hope that the same is extended beyond this fiscal next year. The government’s focus to align the definition of affordable housing in the Income-tax Act with the GST Acts and the proposal to increase the limit of carpet area from 30 square meters to 60 square meters in metropolitan regions and from 60 square meters to 90 square meters in non-metropolitan regions is a welcome move for the homebuyers. Government’s concrete steps to address the NBFC crisis will encourage investments in the real estate sector and will in turn push the economy on a steady growth path.   

 

Manufacture Industry

K John Baby, CEO, Funskool India

“The Government’s move to continue with the policy of phased reduction in Corporate Tax rates, is a welcome step. The widening of Annual Turnover from 250 Cr to 400 Cr will reduce the tax liabilities for a large number of companies and boost profits in the long term. We welcome the Government’s initiative to crack down on nefarious activities and unfair trade practices that have availed undue concessions and export incentives, in the past. The fully automated GST Refund Module and Multiple Tax Ledgers for a taxpayers, are few steps which will bring transparency in the retail sector. Additionally, the Government’s scheme of the Pradhan Mantri Kaushal Vikas Yojana, will help create a large pool of skilled manpower and avoid skilled Labour shortage in the future.”

 

Suresh Balaji, Country Manager, ALOGIC

The government has taken definitive steps to boost manufacturing by inviting global companies through a transparent competitive bidding to set up mega-manufacturing plants in the areas of sunrise and advanced technology areas such as computer servers, Laptops among others. Also, the move to provide income tax exemptions under the Income Tax Act, and other indirect tax benefits will largely benefit the companies who have plans to invest and manufacture in the country. The extended emphasis on providing robust infrastructure, job creation and digital economy will go a long way in channelling the growth for manufacturing in the country. The impetus to solidify ‘Make in India’ is a positive step and will provide the domestic industry a level playing field and bring them at par with the global manufacturers in the next few years.

 

Healthcare Industry

Dr Alok Roy, Chairman, Medica Group of Hospitals

“The Government has rightfully focused on bringing in several key structural reforms for the nation moving towards the goal. We would like to congratulate the Government for displaying commitment and concern towards improvement in Public Healthcare aiming to create a healthy India, with comprehensive wellness derived environment for all.

We are happy to see that the government has proposed to expand Swachh Bharat Mission to undertake sustainable solid waste management in every village of the country. Rural health hygiene has definitely improved. Citizens are expected to be less vulnerable to communicable diseases in open defecation free villages. I believe the Swacch Bharat Mission is an ideal holistic mass initiative and has been effective and successful in changing the mind-set of people in the country.

100% FDI in insurance intermediaries is a push for the insurance sector. Going forward we expect more people will be under the insurance coverage net and the transactions in hospitals will be faster. This will increase health security at the same time and create more opportunities in the sector. Additionally, the deduction limit for medical insurance that has been increased from Rs. 15,000 to Rs. 25,000 and for senior citizens, till Rs. 50,000, will augur well for individuals.

The industry was intently looking forward for further announcements regarding Ayushman Bharat taking the right partnership approach to a more inclusive participation. Some relief on imported medical equipment could have been provided which would have benefitted the sector.”

 

Agriculture Industry

Amit Saraogi, MD, Anmol Feeds Pvt Ltd.

“We welcome the Pradhan Mantri Matsya Sampada Yojana (PMMSY) that will focus on addressing the critical infrastructural gap in fisheries sector. Due to the increase in demand of healthy animal protein consumption, fish farming and aqua culture has become an important and growing sector not only in India but across the world.

Impetus provided to develop the infrastructure of the fisheries sector will yield in better productivity and efficiency, thereby, strengthening the value chain, including infrastructure, modernization, traceability, production, productivity, post-harvest management, and quality control. This will certainly benefit the aqua farmers and the rural economy in a big way.

The government’s decision to upgrade agricultural infrastructure and support entrepreneurship in farm sector is a positive move.

However, the livestock feed industry was expecting an address on the maize deficit as well as pricing issue that has been plaguing the industry since last year and offer some relief. It might impact the food security of the citizens in the long run.

The sector will benefit from the Pradhan Mantri Gram Sadak Yojana which will enrich road connectivity to deeper pockets of India.”

 

Jewellery industry

AnchorAmarendran Vummidi, Managing Partner, Vummidi Bangaru Jewellers.

“We are happy to be contributing towards the growth of the country. This 25% increased revenue to the exchequer will boost the economy. We also request the government to take strict and adequate measures to curb smuggling of gold, which puts the arbitrage in the hands of the anti- social and law-breaking individuals.”

 

Hardayal Prasad, MD & CEO, SBI Card
 
“It is an all-encompassing budget with an adequate focus on fundamental aspects of economy such as infrastructure, agriculture and rural sector. The government has reinforced its commitment towards encouraging digital economy. This, along with its continued focus on improving digital literacy and infrastructure, especially in rural areas will definitely help country to move towards cashless economy.”

Debajit Roy, Country Director, QAD India
 
"The government's move to lower the GST  on Electric Vehicles has opened new avenues for the industry. Reducing the GST on EVs from 12 per cent to 5 per cent can be seen as a big step in favor of sales of EV cars in India. The deduction of Rs 1.5 lakh on the loan interest to purchase an electric vehicle in India will  not just  benefit  the industry  but also for consumers who are looking to switch to electric vehicles
 
There is pool of the companies emerging in this space to evolve the entire ecosystem and the opportunities created by government will enable these companies to penetrate fast. Moreover with the liquidity gap being addressed in this budget, the industry will even move forward towards  economy's growth"