Budget reactions - 1
February 1 2020: Here is a first set of reactions to the Indian Budget 2020.
Kishore Jain, President, CREDAI Bengaluru: The government has taken many measures which will help fulfil the aspirations and vision of most of the sectors but the real estate sector has not been discussed much during the Budget. Measures on the repo rate deduction, GST rate reduction on construction materials etc. were not mentioned. Deduction on housing loans in affordable housing segment has extended by one year. The provision of tax holiday for the developers of affordable housing sector will further boost the segment. Also the concession provided to the real estate transactions will bring in more investment to the sector. The government did not announce schemes or policies to fulfil the promise of ‘’Housing for all by 2022”, within two years.
Prakash Mallya, VP, and MD – Sales and Marketing Group, Intel India: The Union Budget highlights the role technology-enabled innovation can play in leapfrogging the nation. From integration in priority sectors like agriculture and healthcare to a continued focus on smart cities, the first budget of the new decade clearly outlines the significance of a digital-first India in realizing the country’s potential. I am especially encouraged by the efforts to use artificial intelligence (AI) and machine learning (ML) to improve disease detection and pre-emption as part of the PM Jan Arogya Yojana. Such applications of emerging technologies combined with the focus on increasing the penetration of fibre connectivity in the nation have the potential to fundamentally impact the lives of millions in the coming years.
Mitesh Shah, Head of Finance, BookMyShow :At the onset, we would like to laud the Government for a growth-driven budget. We welcome the progressive policies aimed at encouraging rural demand, changes in personal taxes to spur consumption, impetus to infrastructure development, measures aimed at bolstering growth and reversing slowdown. Additionally, taxation related to ESOPs as a perquisite and removal of DDT are significant moves. However, it would have been beneficial to have the benefits of taxation relief on ESOPs expanded to companies and industries at various stage of growth and not be limited to startups alone.Compliance on e-commerce has been increased by mandating them to deduct a TDS of 1% on all goods and services sold on e-commerce platforms. This would be in addition to TCS under GST and this amendment might further increase the cost of compliance for e-commerce companies. The government’s vision to build data centre parks, allocation towards quantum computing and its focus on using artificial intelligence in statistical and other government departments will take India’s growth story to the next level and help further the 'Digital India dream
Vartul Jain, SVP and Chief Financial Officer, GreyOrange: It is heartening to see how this year’s Union Budget focuses on promoting India as an investment and innovation hub. Focus on entrepreneurship, skill development and supply chain economy as well as thrust on technology are important for the growth of the Government’s Digital India and Make in India programs.Measures such as an Investment Clearance Cell, early stage fund and multiple tax rebates and relaxations for startups–will help widen their scope and provide more opportunities. From a business perspective, Government continues to extend its support to MSMEs and bolster their growth by allowing for debt restricting, all of which will help boost the entrepreneur ecosystem.
Sunny Nandwani, Founder, Managing Partner, Acuver:The Budget 2020 by finance minister Nirmala Sitharaman claims to have provided an annual benefit of Rs 1 lakh crore on account of GST where every average household saves monthly 4% on account of reduced GST. This improves the consumption and saving for each individual... Addressing the retail sector specifically, the National Logistics Policy will now advance towards making MSMEs more competitive as the policy will be released soon. More, the new budget dynamics will act as a booster for Food Corporation of India and Warehousing Corporation of India.
Nikhil Barshikar, Founder and Managing Director, Imarticus: With an increase in the allocation of funds from 94,800 cr last year to 99300 this year, the government continues to invest more in the education sector to infuse growth in the country. Addressing the severe skill shortage that businesses across India are facing at present, focus on skill development will lead to progress in the nation. We are also very affirmative with regards to the new education policy that will ensure quality education to students. Also, the introduction of degree-level full-fledged online education will empower the disadvantaged sections of the society in acquiring employable skills and for upskilling.
Basavaraj Puttappa, Founder and CEO, Zeva Astras: As per our expectations, the Budget 2020 has proposed a slew of measures to propel the economy towards growth. The government’s sustained push for tech innovation and entrepreneurship is encouraging from a market perspective. The Budget has particularly proposed a conducive environment for the start-up sector in India and these measures are sure to cement India’s position as a hotbed of startups. The market also stands to gain from the revised Income Tax structure as it indicates a higher disposable income in the hands of the common man.
Akshay Mehrotra, CEO and Co-Founder of EarlySalary:The Union Budget 2020 is an encouraging step in the right direction, with a focus on three themes - aspirational India, economic development, and compassion – to empower the common man.
This year’s Budget aims to improve liquidity in the Non-Banking Financial Company (NBFC) sector. This move, in turn, will greatly benefit the Fintech industry. The decision, especially reduction in refinances options for NBFC to Rs. 100 crore, will give a much-needed boost to this sector.
Dr. Vikas Joshi, Founder and CEO of Harbinger Group: Although the budget is high on aspiration, it may fall short in substance. In a welcome move, the budget is aligned to employment-generation in emerging sectors with a focus on skill development, internships for fresh engineers from urban local bodies, and online degree programs from top academic institutions. However, growing the supply of skilled resources is one side of the growth story. The other side is growing the demand for such resources. A 10% growth target is aspirational, yet lacking in concrete pro-growth measures, especially in high tech industries. Although slashing corporate taxes and introducing faceless tax assessments are welcome measures, the Budget has no benefit extended to the IT industry in particular.
Manish Mishra, Partner, J. Sagar Associates: Budget focusses on providing impetus to domestic industry by rationalizing Customs duty exemptions, and levying duties on import of goods for specific industries which are focused on ‘Make in India’ including increase on customs duties on electric vehicles. Government has taken steps to ensure measures to curb abuse of benefits available under the preferential / free trade agreements harming the domestic players. Keeping this theme in mind safeguard duty and anti-dumping duty has also been imposed on specific sectors.
Hemal Gathani, Co-founder of Zeux Innovation: Two messages stand out from today’s Union Budget address for companies like us. One, the commitment being demonstrated by the Government to emerging technologies and initiatives being taken to improve the ecosystem – be it in terms of setting knowledge or technology clusters or announcing a National Mission on Quantum Technologies. Having relocated from US to start a company here, we are thrilled with the government’s resolve on this issue. Two, trying to do their bit in creating more stable start-ups – by resolving issues such as tax relaxation on ESOPs. Although much more is still to be done jumpstart the economy, but steps such as these will surely help stem the fall and lay new ground for growth.
Dr Rishi Bhatnagar, President, Aeris Communications: We welcome and feel motivated with the budget announced today by FM highlighting ‘Technology’ as one of the important pillars that will help in making India a $5 Tn economy soon. Triggering the digital revolution with use of new-age technologies like IoT, AI and Machine Learning in economic, healthcare and agriculture development, government should also focus on using the allocated funds for automation and mechanisation in these fields. With these initiatives, technology companies like Aeris will be able to provide IOT technology services like efficient waste management and higher productivity in the field of agriculture, utilities, finance, asset assurance and fleet management and more.
Dharmender Kapoor, CEO & MD, Birlasoft: The budget has clearly recognized the importance of Talent, Technology and Entrepreneurship in the growth of the country. It is commendable to see the continuous commitment of the government to bridge the skill gap and to develop India's large talent pool, for which the govt. has allocated INR 3,000 crores towards skilling. Technology is a given and digital technology is the force driving the turmoil for this industry, whose future is yet to be unleashed. The proposal of a policy to set up data centre farms throughout the country will push more efficiency on data, as data is the new oil, but right now it is in the form of crude oil.
Rahul Sharma, MD-India, LogMeIn: Budget 2020 looks very promising. We are particularly enthused about the FM’s announcement of seamless delivery of digital services as part of the next wave of digital revolution. AI, ML, Analytics, IoT, Robotics are making giant inroads in India, as was observed in the budget. The policy being introduced to build data centre parks throughout the country will help enhance the digital infrastructure to a significant extent. We are looking forward to the next phase of Digital India which will be a big growth driver for businesses and individuals alike.”
Aakrit Vaish, CEO, Haptik : As digitization and advanced technologies continue to gain momentum, we welcome the Budget 2020 announcements. Once again, the Finance Minister’s emphasis on machine learning, robotics, AI and IoT will help boost India’s digital journey. A significant proportion from the allocation of INR 3000cr for skill development should focus on these cutting-edge technologies. We are also delighted to witness proposals such as the linking of 100,000 Gram Panchayats through the enhancement of Bharat Net and setting up of data centre parks across the country. As national systems become more sophisticated and our workforce is equipped with the relevant skills, we will truly see the next wave of digital revolution, with greater scope for large-scale indigenous innovation.
Suganthi Shivkumar, Managing Director, ASEAN, India & Korea at Qlik:We appreciate the government’s decision in the 2020 Budget to dedicate the necessary funds and resources towards developing revolutionary and breakthrough technologies such as ML, robotics and AI to further the skills that will prepare us for the next wave and accelerate India’s journey towards becoming a digital giant. With data equated as the new oil, the government’s plan of building cutting-edge data parks across the country is equally important. Furthermore, the governments initiative of allocating Rs 6000 crores to enable unabridged digital connectivity in over 100,000 Gram Panchayats through the Fiber to Home BharatNet scheme holds brilliant potential in securing India’s passage towards achieving tech-empowerment for the remote sector.
Yashash Agarwal, CEO, Gamezop:FM's proposal of delaying tax collection on the exercise of ESOPs is a welcome move. The current structure looks to collect taxes too early causing employees to not exercise vested shares. Easing direct taxation for eligible startups will encourage businesses to chase the right metrics and not just growth at the by bleeding money. The definition of "eligible startups" must be broadened to bring more companies in this fold.
Rakesh Kharwal, Managing Director, India/South Asia & ASEAN, Cyberbit: The government has highlighted the role of digital technologies like analytics, IoT, AI, and quantum technology during this Budget Session. The burgeoning digital infrastructure of India needs a strong cybersecurity framework to support it. Now, since it has allocated Rs. 99,300 crores to the education sector and Rs. 3,000 crores for skill development itself, a good way to realize India's digital vision could be by working on the cybersecurity front from the very beginning.
Akash Gupta, Founder and CEO - Zypp (Earlier known as Mobycy): The Union Budget 2020 paints an affirmative picture for the future. We are glad that the Finance Minister has emphasised on improving the air quality, citing that the matter of clean air is a matter of concern in large cities that have a population of over 1 million. To the same end, we believe that EV-powered everyday commuting solutions offered by Zypp through Electric Scooters and Logistics solutions will play a crucial role in times to come. The budget announcement further comprises positive news for India’s fast-growing start-ups. The proposal to set-up investment clearance cell for entrepreneurs along with assistance in funding would definitely prove to be extremely beneficial.
Ambika Sharma, Managing Director & Founder at Pulp Strategy: The latest budget announcement for the year 2020 -21 bears vast potential in shaping India’s road towards achieving its target of emerging as a 5 trillion dollar economy. With India currently posed as the fifth largest economy in the world, I am particularly enthralled by the government’s decision to optimize new-age disruptive technologies such as Machine Learning, robotics and Artificial Intelligence (AI) towards attaining a seamless and integrated service sector. Further advancing the digital revolution in the country is the government’s resolution of developing state-of-the-art data centers across the nation. Moreover, the FM’s proposal to allocate Rs 6000 crore for connecting 100,000 Gram Panchayats by FY21 will also prove instrumental in accelerating India’s journey towards becoming a tech –enabled nation. will vastly help in furthering women empowerment and gender equality.
Abhishek Kumar, Regional Director, Onvu Tech: This year's budget includes a number of positive reforms for the surveillance and security agency. The government has announced the launch of Police Academy and Forensic Sciences, 5 more smart cities, 9,000 KMs of economic corridor, enhancement of tourist attractions, and improved business landscape for MSMEs alongside others. Security and Surveillance infrastructure is a core element of all of these reforms and will give a strong stimulus to the segment.
The government has announced a number of measures for the education sector with a whopping Rs. 99,300 crore budget. With it, courses will go online soon and Top-100 NIRF Ranked Institutes start offering them. The government has also announced positive reforms including Asian-African 'Study in India' program, establishment of Police Academy and Forensic Science, and integration of medical institutes with dist. hospitals. Rs. 3000 crores have further been allocated for Skill Development. Perhaps, all of these reforms will go a long way by including video-analytics-based EdTech solutions to them as well.
Piyush, Founder & CEO, Rooter: It’s very encouraging to see that Indian Government regards entrepreneurship as “strength of India”. Start-ups can not only get a lot of foreign investment in India but also create thousands of jobs. The investment clearance and advisory cell for entrepreneurs is a great step to encourage new entrepreneurs and provide assistance. Moreover, the seed fund to support early-stage start-ups will help them to create quality market fit product before approaching VCs
Bhavin Turakhia, Founder & CEO, Flock:We are delighted with the steps taken by the Government in the Union Budget towards providing an impetus to entrepreneurship and acknowledging that startups are major job creators. This year, the budget has allocated Rs. 3,000 crore for skill development, which will help in creating a future-ready workforce. The provision for setting up an investment clearance cell for entrepreneurs, an online portal to facilitate quicker business clearances, and a seed fund to support early-stage startups will all collectively attract foreign investment in Indian startups.
Shashank Dixit, CEO, Deskera: There are 3 key takeaways from the Union Budget 2020 for ease of doing business and the startup community. 1. The simplified GST return system scheduled to be launched in April’20 will reduce the compliance burden on SMEs. 2. The threshold for audit being raised from Rs. 1 crore to Rs. 5 crores will further provide a fillip to Indian SMEs. 3. With the abolishment of Dividend Distribution Tax (DDT), it is sure to make India an attractive investment destination.”
Kunal Lakhara, VP of Finance and Operations, Pocket Aces:Budget 2020's revised fiscal deficit target of 3.8% of the GDP seems more realistic and focus on spends/ benefits was required to boost the economy. The thrust on entrepreneurship and tax regulations for both, startups and taxpayers is a move in the right direction. India is the third largest startup hub globally and the announcement of an investment clearance cell to provide end-to-end support to startup founders will encourage more youth to be job creators.
Naveen Chava, CEO, IDSign:With today's union budget themed around three strong aspects- Aspirational India, Economic Development and Caring Society, the Government of India has reassured its promise in promoting the Indian startup ecosystem for a vibrant and inclusive economy. The proposals aimed at bringing fundamental structural reforms and digital governance such as setting up investment advisory cell online to help young entrepreneurs with faster clearance and launch of seed fund to support early-stage startups come as a major booster for the sector. The decision to relax much-awaited Esops is a laudable move which will now help startups to attract new talent pool.
Naina Parekh, CEO, EUME: The Union budget 2020 shows extreme promise for the entrepreneurial and start-up segment. With a surgical focus on MSMEs and new-age entrepreneurs, the government seems to have charted a clear roadmap for progress, by establishing a single investment cell to infuse positive funds and eliminate roadblocks for new businesses... Additionally, with digitization and enhanced connectivity playing a pivotal role in economic growth, we aim to expand our customer base through the burgeoning e - comm segment.
Tim Nicolle, Founder, PrimaDollar:The Finance Minister’s announcements under Union Budget 2020 introducing new schemes will help the small players in the export sector in a big way. The new Nirvik scheme introduces high insurance cover for exporters at a reduced premium. Simplified processes for faster claim settlements will be beneficial for both the exporters and the general insurers.It will lead to providing high insurance cover, reduction in premium for small exporters and simplified procedures for claim settlements,this will encourage export finance. This will boost exports. Coming to the MSMEs, the announcement for the subordinate debt for entrepreneurs is a big positive and will help the MSME sector benefit in a massive way. These seem to be sound measures that can stimulate profitable activities for players in the trade and finance sector.
Harsh Jain, Co-founder and COO, Groww:The government's decision to spend Rs 6000 cr on Bharat Net, to increase accessibility to the internet, will give a huge boost to internet-based companies -fintech being a prominent sector that will be benefited from the move. This will enable e-commerce and fintech companies, particularly the ones operating in the investment and lending domains, to serve customers in parts of the country that are not served by more traditional offline service providers and increase their footprint.
Indroneel Dutt, CFO, Cleartrip: The government has backed its vision to turn India into one of the world’s top tourism hubs by allocating INR 2,500 crore for promoting tourism in general and setting aside a sum of INR 3100 crore for the Culture Ministry to boost regional tourism. What would be wonderful is to have an empowered nodal body comprising of the Govt / OTA / airline, hotel and other industry representatives with the objective of promoting discoverability, ease of booking and fulfillment of our cultural, natural and heritage sites.Introduction of more Tejas Express type trains and the inauguration of several culturally-significant archaeological sites are other much-needed moves.
Anjani Kommisetti, Country Manager - India & SAARC, Raritan & Servertech (brands of Legrand): The government’s initiative of setting up data centers will bring in an advantage, especially in tier two cities. With internet connectivity and digitalization in smaller parts of the nation, we are sure to see an economic growth. Today, data centers are only present in tier 1 cities of India and with operational costs, it is difficult for businesses in tier 2 cities to adopt even micro data centers. Once we see more data centers being set up in smaller cities, it will mean lower costs for businesses and they will move towards cloud or web-based applications. This will further improve the supply chain as businesses even at lowest levels will generate data that will eventually improvise their business.
Pradeep David, General Manager, South Asia, Universal Robots:We foresee a huge boost for the manufacturing sector considering that the projected GDP growth for 2020-21 is 10%, as opposed to just 5% last year. Whether small manufacturers or large, the rising tide will carry all boats and a 10% growth will benefit everyone. There is also a specific scheme that targets boosting mobile phone and electronics manufacturers. With huge global customers like Wistron, the electronics sector is a major focus for us, so this also shows a lot of promise.Furthermore, there is an emphasis on Make in India, specifically to boost MSMEs and further develop start-ups, defence manufacturing, automobile, and batteries, to name a few. All of these industries have manufacturing problems that would be solved by the deployment of collaborative robots.
Barun Aggarwal, CEO, BreatheEasy Consultants: It is a welcome move by the Central government to encourage states that are formulating and implementing plans for ensuring cleaner air in cities above one million population with allocation of Rs 4,400 crore. On the policy front, we need a stringent legal framework to punish the polluters. The government has the national level target of bringing down the concentration of PM 2.5 and PM 10 by up to 30% by 2024. But these targets are not notified under any act. There are no emission reduction targets for polluting sectors like transport and power generation. There are no targets for the cities. There is no regulatory body that has the authority to take action against air polluters and enforce NCAP measures. Without a legal framework and strict enforcement of pollution control regulations, the government’s well intended targets are not going to be achieved.
Mallikarjun Kukunuri, CEO of Niruthi Climate and Ecosystem Services: The strategic action plan launched by the government in the Union Budget 2020 will be a path towards reviving the sector and doubling farmer's income. Increasing the allocation of funds to empower the sector will further open up new avenues for farmers to strengthen the ecosystem finally contributing to India's economic growth.
In line with the theme of aspirational India, sustainable cropping patterns coupled with new-age technology will further boost the productivity and efficiency in the agriculture value chain. Liberalisation of farm markets and increased competition will prove to be a game-changer in order to bring back the sector on track.
Nishant Pitti, Co-Founder & CEO, EaseMyTrip: In tune with the present government vision to encourage Indian travellers to travel more and contribute towards the nation's growth, this budget takes it a step ahead. The budget has focused on promoting tourism & travel with an overall budget of Rs. 2500 crores in year 2020-21. Government aims to develop 100 more domestic airports under the UDAN scheme. To promote travel via railways, government will focus on more Tejas type trains that will connect tourist destinations in India.
The Finance Minister has also laid stress on the development of archaeological sites into iconic sites with on-site museums. Five such sites are- Rakhigarhi, Hastinapur, Shivsagar, Dholavira and Adichanallur. Government has also announced renovation of 4 key museums. Rs,150 crore have been allocated for the ministry of culture in 2020-21.
Ritesh Gandotra, Director, Xerox Business Services: If this budget had to be known for one thing, it would be the length and breadth of technology infusion across all aspects. The focus on data, digital records, connectivity and data security across key citizen services underlines the government’s faith in technology to deliver better governance, a safer society and a more competitive economy. The proposals for building data centre parks and setting up the ambitious National Mission of Quantum Technology and Application are significant announcements to put the technology intent into practice.
Dr. Ambrish Kumar Founder & CEO Logycode: The Union Budget has addressed some of the hopes of the logistic sector as the government has given green signal to the National Logistics Policy. Setting up of single window e-logistics market and focus on the generation of employment, skills and making MSMEs competitive will further give a boost to the sector. Apart from this, the focus on Inland Waterways will also provide acceleration to the sector as the development of waterways will energize economic activity along river banks. Further, the allocation of Rs. 1.70 lakh crore for transport infrastructure in 2020-21 will bring necessary development.