What Industry feels about Union Budget 2020-21

New Delhi, Feb 1 (KNN) As Union Finance Minister Nirmala Sitharaman gave her second budget speech in the Parliament today, KNN India spoke to MSME entrepreneurs from across sectors to know their takes on the Budget.

Mr. Sachin  Dhanawade,  Chief Operating Officer (COO), Retail & Real Estate, Grauer & Weil (India) Limited:  The feel-good factor in the budget announcement was definitely the new tax regime that gives more money in the hands of the consumer as it will boost consumption, unless negatively impacted by the revised exemptions

Mr. Kumar Rajagopalan, CEO Retailers Association of India (RAI): RAI had two expectations from the budget this year: Ease of Doing Business and a national policy for retail. We are pleased that the Budget 2020 paves the path for both in some way. The mandate to states for adopting model laws and decriminalisation of statues are some welcome moves on those fronts.  More money hands in the consumers definitely boosts consumption however we have to calibrate for non-allowance of deductions.

Ms. Munira Savai, Country Manager, QAD India: Union Budget 2020 has concentrated on the development of the country and has brought a positive sentiment to the economy as a whole. We are glad to know that the government has come up with an extensive plan to boost the manufacturing sector with the investment plan of almost Rs 22,000 crore for the infrastructure projects, that might also introduce emerging technologies targeting to strengthen the entire ecosystem. Also, the policy of setting up data center parks is set to open up new opportunities for tech services companies which will attract foreign investments to creating an adequate infrastructure for all industry sectors. We are confident that these developments will drive significant growth for the entire sector

Parimal Heda, Chief Investment Officer, Digit Insurance: There was lot more we were expecting from this budget on measures to revive the auto industry, increase in tax soaps, etc but it is good to see the focus on digital governance pushing for digital revolution in a big way. A viability gap funding window will be set up to set up hospitals in PPP mode and in its first phase those districts will be covered where presently there are no Ayushman empanelled hospitals.  Machine learning and AI in Ayushman Bharat scheme shall enable better designed disease preventive regime and create better healthcare facilities”. “Recapitalization of INR 6950 crores of PSU Insurance companies will help in terms of improving their solvency metrics and is a step towards merger of the PSU general insurers

Kushal Nahata, CEO & Co-founder, FarEye:

We welcome the progressive budget by the government this year. The logistics industry has been a key focus for the government in the past few years and with the announcement of the soon to be launched National Logistics Policy- the industry is going to get a major boost.

Allocation of Rs 1.7 lakh crore for transport infrastructure in FY21 and the move to monetize 12 lots of highway bundles of over 6,000kms before 2024 is welcoming news as it will positively impact freight movement and transportation expenditures.

The government’s focus on promoting disruptive technologies like AI and IoT is critical for the supply chain and logistics industry. It’s important for enterprises to leverage these technologies to improve operational efficiencies and keep margins wider. The government’s plan to bring out a policy for data center parks throughout the country will definitely empower the IT-services industry.

Mr. Yogesh Bhatia, Founder and CEO, Detel: We welcome the initiatives announced by the honorable Finance Minister to boost the start-up ecosystem. The measures made by the government will encourage fresh investment in the sector because the proposed scheme is set to focus on encouraging the manufacturing of mobile phones and electrical products. The government planned to reveal more of a detailed scheme to boost mobile phone, electronics products in the country and to initiate more of phones and electronics to be Made in India soon. We are glad for this opportunity that the government has taken and it encourages us to scale up our defined mission of connecting 40 crore Indians.

Mr. Kashish Jhamb, Executive Director and CEO, City Innovates: This primarily enables tech-centric start-ups with the more favorable business environment as new investment clearance cell scheme is set to provide end-to-end facilitation and support to start-ups which are driving potential technology businesses such as AR / VR etc. I consider this as one of the highly significant initiatives taken by the GoI that is set to encourage young entrepreneurs with powerful business ideas. We are glad to know that the government proposed Rs. 27,300 crore towards the development and promotion of industry and commerce in 2020-21 which will contribute to the economy’s growth.

Dr Pulkit Mahur, CEO, Queppelin: It was heartening to see FM Sitharaman recognise the importance of Deep Tech is driving the next wave of growth in India. From AI in Ayushman Bharat to Data Centre Parks to allocation of Quantum Tech....there was enough in that Budget for the Technology sector to be enthused about.

Mr. Amit Gupta, CO-Founder and CEO, TradingBells: Market structure is very weak where it was vulnerable to fall on weak global cues while there was only hope that out of the box budget could reverse the direction of the market but the budget was in line expectations with disappointing on LTCG front. The rationalization of DDT is the only cheerful factor for some high dividend-paying companies like IT companies. There were no major steps that could boost economic sentiments immediately.  The market is taking budget as a non-event and continuing its downfall in tandem with a fall in the global market amid worries of Coronavirus.  

Some cut in income tax was already expected which cause some immediate positive reaction in some consumption stock but then they witness sell off at higher levels. The cut in income tax comes with a rider of giving up exemptions which are also one the reason for disappointment, especially life insurance stocks fell sharply because it is expected that those forgoing exemptions to move to lower tax regimes may not take life insurance.  

In terms of other positive developments, insurance guarantee on deposit raised to 5 lakh from 1 lakh and FPI limit in bond market raised to 15% from 9% are meaningful.    

The government is going to sell a stake in IDBI bank which was taken positively by the stock market and the government will sell part of LIC through its listing in the stock market which is also a positive trigger for the market.  

Technically, Nifty has corrected significantly where it is trading near critical support of 11700 which coincides with its 200-DMA of 11655 where we can expect a pullback from here if the worries of coronavirus ease otherwise the downward journey will continue with some time consolidation. In the upside 11925-12000 zone will act as an immediate and strong supply zone.

Sharad Kumar Saraf, President, FIEO: The Union budget has attempted at structural changes in agriculture, horticulture and pisciculture, through 16 Action Points, to make India a major player in agro and allied sectors exports in medium to long term basis besides simultaneously doubling our farmers income.

NIRVIK will ease the lending process and enhance the availability of credit to exporters. Under the Scheme, the insurance over guarantee will now cover upto 90% of the principal and interest both on pre & post shipment credit.

Deepak Mittal, CEO & Co-founder, TO THE NEW:  We are thrilled with the announcement of a soon to be rolled out policy to enable private sector to build data center parks throughout the country. This would reap benefits such as on-demand access to ICT infrastructure, cater to Indian regulatory requirements as well as drive scalability for businesses in India. We were, however, also expecting the government to announce measures with respect to Data Protection keeping in mind the amount of Data being created and stored at unprecedented rates.

Moreover, the government’s move to set up an Investment Clearance Cell for entrepreneurs to offer assistance in funding, will certainly encourage more start-ups to set up their businesses in India. This will, in turn, lead to the growth of the Indian economy. With a slew of growth measures announced, the emphasis of the government is very clear on the overall economic development."

Ritesh Jain - Co-Founder at FlexiLoans.com: Nirmala Sitharaman has presented a holistic budget and it is an extension of ambitious schemes announced by the government for doubling farmers' income, infra boost, etc. This instills confidence in the industry that the government is serious about its programs and deadlines. If these schemes are successfully executed it will put the economy on a growth path and create demand in the economy. This budget also supports MSME focused Fintechs like FlexiLoans.com by (i) extending provisions of subordinated debt to entrepreneurs focused on MSME’s, (ii) extension of provisions CGTSME scheme, (iii) mechanism to solve for liquidity crunch for NBFC’s and (iv) allowing NBFC’s to participate on Treds.

Fintechs can take benefit of this growth stimulus and SME focused initiatives.

Neel Juriasingani, CEO & Co-founder, Datacultr: As per our expectations, the budget 2020 is much focused on driving financial inclusion in the country and the initiative to provide digital connectivity to all public institutions at Gram Panchayat level is a key step to support the same. We are glad that the honorable Finance Minister has announced a series of major policies in the budget which will give a push to emerging technology companies in India. Moreover, this budget has addressed the importance of Analytics, IoT and AI with the government planning to set up data center parks throughout the country which will enhance the whole ecosystem.

"We are happy that the budget has given much-required push on creating more opportunities for entrepreneurs. The setting up of investment clearance cell which will offer assistance in funding is a welcome move to boost the start-up ecosystem in India. We look forward to this and to the Government marking progress against it".

Shobhit Mathur, Dean at Rashtram School of Public Leadership: The announcement in the Union Budget of almost 1 Lakh Crore for the education sector is most welcome. Supporting research and innovation and increasing access to high quality higher education should be the priorities. The government should use the funds to set up a National Research Foundation (as suggested in the Draft New Education Policy) focussed exclusively on improving research and innovation. Additionally, to make higher education accessible, the government should subsidize student loans (rather than fund institutions). This will reduce the burden on households, promote competition for quality as students are free to choose high-quality institutions for their education.

Akshaara Lalwani, CEO and founder, Communicate India: On the Budget 2020, Ms Akshaara Lalwani, CEO and Founder, Communicate India, states that, "The budget is rightly woven around Aspirational India, and following its implementation, it will result in a wave of entrepreneurship in our country which has been the core of innovation. This will provide a valuable impetus for economic growth through employment generation. With the government requesting the RBI to consider extending the window of debt structuring by one year to March 2021, it will go a long way in aiding MSMEs and is pivotal to help grow India to a 5 trillion economy, and as a nation, we can look forward to this impetus driving better GDP growth. Additionally, women are at the heart of change in a country be it social environment or economics. The Union Budget 2020 shows their much-needed commitment to the development of women and protection of their rights and helping them overcome hurdles they face.

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