Industry leaders from across media, marketing, advertising, like K Madhavan, President – Indian Broadcasting Foundation, Ashish Bhasin, CEO-APAC and Chairman-India, Dentsu, and other eminent leaders from other sectors like Dr. Pawan Goenka, Managing Director and CEO, Mahindra & Mahindra Ltd. along with several others, have welcomed Finance Minister Nirmala Sitharaman’s Budget 2021.
Here’s what they have had to say:
K Madhavan, President of the Indian Broadcasting Foundation
This is a growth-oriented budget that will provide a strong and much-needed impetus to the economic growth engines in the wake of the pandemic. The focus on privatisation and providing support for startups and innovation is likely to benefit the overall corporate sector and in-turn help the media and entertainment industry, as it will lead to strong advertising growth.
“I believe this budget can pave the way for the resurgence of economic growth in a significant and impactful manner.
Ashish Bhasin, CEO-APAC and Chairman-India, Dentsu
According to me, this is a great Budget for the economy as well as for the advertising industry. It is clearly a growth-oriented budget and I am particularly enthused about the investments in Infrastructure and Health. What is also good is that the taxes have not been raised and the process of taxation has been attempted to be simplified. Disinvestments and Borrowings have been proposed as the preferred funding route, rather than increased taxation, which is helpful.
Whenever the economy does well, the advertising industry benefits. Hence, I feel this economic growth that the budget fuels will result in good growth for the advertising industry this year and we should be positive and bullish, both about India’s economic future as well as for the advertising industry.
I also like the thrust towards increased usage of digital, including in governance, starting from the symbolic usage of an India made Tablet to read the budget from, by the Finance Minister.
However, one has to still see the fine print because the important thing is that the ideas presented must result in smooth on-ground implementation, where our track record has not been that great in the past.
Overall I find this a good, growth-oriented budget, with some benefits for almost every section of the economy and hopefully this should bring our GDP growth into double digits making India the world’s fastest-growing economy this year. (You might also like this)
Dr. Pawan Goenka, Managing Director and CEO, Mahindra & Mahindra Ltd.
This is a Budget with the head and the heart at the right place. As the industry was looking forward to, this is a growth-oriented Budget, with significant focus on healthcare and infrastructure, two areas where everybody wanted to see a lot of focus.
I am glad that the scrappage policy has been acknowledged in the Budget and expecting the policy to be announced very soon. Though details are not yet out, when the policy comes out, it should have full incentive for scrapping and not just disincentivize for not scrapping. If I look at the tractor industry there is a lot of incentive on the agri economy and other agri businesses.
Everyone is relieved that there is no Covid cess that has come in or any extra taxation, which is a good thing. We have also seen some bold moves in terms of Bad bank or ARC which were hoping. There is nothing much specific in terms of sectorial intervention, but that is fine since the Budget is focusing on overall growth and increasing denominator which should otherwise help all the sectors. Overall the Finance Minister has delivered a promised Budget that will go a long way and not just for 1 year.
Ambika Sharma, Founder & MD, Pulp Strategy
Doubling of MSME allocation, setting aside Rs 15,700 crore for medium and small enterprises in FY22, comes as a welcome move.
Increased inclusion of women in the workforce is a good move, and will have a long term positive impact on household income. The services sector has negligible focus in the budget. (You might also like this)
Praveen Nijhara, CEO, Hansa Research
The budget gave a strong feeling that the government is very keen on making sure that the rural-urban divide is bridged, and quickly. Rural economy has reported heartening numbers and one believes that India’s post-COVID recovery will be triggered from the villages and towns. The budget does well to make sure that the government spends towards making society more equitable. One would have hoped for some relief to income taxpayers keeping in mind the tough year gone by, but I suppose the FM won’t hesitate in revisiting that part of the budget if need be.
As a research & insights firm, we are very happy with the Rs.3,768 cr allocation made for the census. The fact that this will be India’s first digital census is only the icing on the cake and we very much look forward to seeing it happen.
Sai Srinivas, Co-founder and CEO, Mobile Premier League(MPL)
Government’s budget announcement has been extremely encouraging for the start-up ecosystem in India. The extended exemption on capital gains for investments will definitely make more funds available for budding entrepreneurs and growing organizations alike.
Digital payments infrastructure has played a very important role in the growth of the mobile gaming industry. It is very encouraging to see the government’s efforts to strengthen digital payments through incentivization. The Rs 1,500 crore boost will further support migration of more people towards digital payments and will have a positive impact on the mobile skill gaming industry.
The incentivizing of one person companies is especially heartening as it promotes the development of more game creators that will help in strengthening the gaming industry in India. The move has also allowed conversion of one-person companies to any other kind, reducing residency limit from 182 days to 120 days.
India is at the cusp of creating a wave of mobile gaming unicorns, these measures only support that momentum. With these announcements acting as winds in our sails the Indian Gaming Industry can aspire to be the Global Hub of game development.
Abheek Barua, Chief Economist, HDFC Bank Ltd
A bold budget in many senses. The central intent has been to use expansionary fiscal policy to support growth sidestepping concerns over debt sustainability and sovereign rating. The fiscal deficit is pegged at 6.8% of GDP in FY22 compared to a revised estimate of 9.5% for FY21. The focus has been on increasing capital expenditure both by the centre (+35% y-o-y) as well as states.
Moreover, the budget introduced new institutional structures (like the Development Finance Institution, asset reconstruction company) and provided greater detail on asset monetisation to finance infrastructure needs in the economy. In light of the COVID-19 health crisis, the budget’s focus on health and sanitisation with increased allocations and introduction of a new health scheme are also welcome steps.
That said, the budget does not adequately address concerns over inequitable growth which has been a worry across the globe due to the pandemic. There has been no specific support for sectors stressed due to the pandemic like the hospitality sector. While the government did not increase any direct taxes, as some sections of the market feared, there has also not been any cushion provided for households – especially in the informal sector that has been hit the most by the pandemic. Therefore, while the budget focusses towards pushing the long term growth potential it does little to prevent a K-shaped growth recovery.
For the bond market, a higher than expected market borrowing estimate (INR 12 trn) in FY22 and additional borrowings of INR 80,000 crores in FY21 are likely to add pressure on borrowing costs. The 10-year yield is up by 16bps since the budget announcement crossing 6%. Over the coming year, higher market borrowings, concerns over inflation and a move towards normalising liquidity conditions by the RBI could maintain pressure on yields. We see the 10 year between 5.95-6.10% by the end of H1 FY22.
Kunal Lakhara, VP of Finance and Operations, Pocket Aces
Hari Om Rai, CMD, Lava International Limited
Government has given a clarion call to the industry with the announcement of creating global champions from India and backing this strategy with new, “development finance institution”.
Now the responsibility shifts to the industry to not only dream but dream big and stand together with the government to make the country progress from poverty to wealth over the next three decades.
Dr. Keshab Panda, CEO & MD, L&T Technology Services
Dr. Chenraj Roychand – Chairman, Jain Group
The budget 2021 brings with it good tidings for the education sector. The highlight being the announcement of establishing 100 new Sainik schools in partnership with NGOs and other private academies and setting up of Central University at Ladakh. Finance Minister Nirmala Sitharaman has also asserted that more than 15,000 schools will be quantitatively strengthened, which gives great impetus to the education sector. The announcement of the legislation for an umbrella body of higher education is just what is required in the post COVID era to boost our education system.
Education is what drives the economy and the country, and I am convinced that the Budget 2021 will go a long way in guaranteeing that our country keeps education at the pinnacle of its priorities.
Hitesh Jirawla, Founder CEO, Cubictree
The FM presented a digital Budget, a yet another first of India. It is a small step but goes to show the intent of this govt to move to digital transformation in every way possible.
Indian Courts have been under tremendous pressure with limited availability of judges. Longer litigation results in higher costs, procedural hassles that consumers and companies suffer. The proposed MCA21 Version 3.0 will roll out e-scrutiny and other compliance management initiatives thereby bringing down the legal costs for companies and individuals.
Use of deep tech, will over time impact the judgement delivery thereby making it faster and for some standard cases, there is a possibility to introduce an element of automation in documentation and other legal processes. We believe the govt has taken a lead in addressing the problems that currently ails the judiciary system in our country. Over time, India may see fast closer of matters and justice served to the people who have been waiting a long time.
Pankit Desai, Co-founder CEO, Sequretek
The much-awaited Budget 2021 has provided a significant push for healthcare, agriculture and rural economy, but unfortunately nothing concrete for startups and the surrounding ecosystem. For the majority of startups, demand remains the same, nothing changes, its business as usual. Forming a one person company doesn’t help startups whatsoever unless they want startups to form a single person company. There is some push for fintech and startups from this sector will stand to benefit, however, the budget did not share anything substantial in terms of ease of doing business, compliance or GST taxation that would make life any different for a cybersecurity company like ours.
I am hoping that the stimulus and other investments that allow the economy to do well, indirectly will support us as we finally serve that economy in some shape and form through our customers.
Pavan Adipuram, Co-founder CEO, ChitMonks
The Budget this year was riding high on expectations from taxpayers and businesses. The FM has tried her best to deliver on a majority of parameters. It is heartening that the much talked about COVID cess wasn’t introduced neither any dramatic increase in taxation for the businesses. For a digital first company like ours, the proposal of Rs 1500 crore to incentivise digital payments will accelerate the financial technologies sector growth.
In investment instruments like Chit Funds, Mutual Funds, online payments, more companies are expected to move to 100% digital payments mode which will ensure further transparency and confidence on individuals and it will address the problem of any scams running that take advantage of innocent individuals. However, the devil would be in the details. We look forward to the details of this proposed scheme as it will tell us how the incentives will work for the companies and individuals.
Kumar Ritesh, Founder CEO, CYFIRMA
This is one of the most business-friendly Union Budget we have seen in a while, and this is rightly so given the urgent need for a strong economic recovery. The initiatives to ease the setting up of new companies bode well for the technology sector. This will promote an even greater entrepreneurial culture and put India squarely on the global map of technology innovation. Given India’s young, dynamic and tech-savvy workforce, we should expect more companies choosing India as a base to leverage on our vast talent.
India’s fast growing middle-class population should also be a magnet for businesses seeking to tap on the underserved market here. Further, the Finance Minister’s announcement that companies will receive RS1500 crore to encourage their adoption of digital payments will go a long way to promote Fintech innovation, and more importantly, give millions of unbanked Indians the opportunity to participate in the financial system.
With digital payments becoming mainstream, the government should also start looking at uplifting cybersecurity awareness and education among businesses as well as consumers. This way, the twin engines of growth – innovation and digitalization – can be sustainable in the long run.
Joji George, Co-Founder, Gonuts
The Budget 2021 announced by Hon’ble Finance Minister today though positive left us wanting some more from a start-up and MSMEs perspective. That said, the budget did reflect the Indian Government’s commitment to boost the Indian start-up ecosystem.
A boost from the budget for startups is important as it carves the next phase for the start-up ecosystem post the pandemic. The government’s decision to bring in institutional investors to invest in startups is a positive move and will help encourage more investment into the start-up community. Of course, the start-up community need to see and understand the fine print.
FM has announced, registration of one-person firms with no limit to paid up capital will boost the start-up ecosystem. That helps small entrepreneurs to take the leap. Government has doubled its expenditure allocation towards micro small and medium enterprises to Rs 15,700 crore in FY22. This is an excellent move for companies like us that work with large number of MSMEs.
Another boost offered by the government is extension of tax holiday for start-ups by one more year. This will help get startups on their feet as they grapple with cash flow and investment.
In the near future, we would want the FM to give a concrete plan on ESOP taxation and hope that the initial deliberation of a 5 year term to pay tax on ESOP is implemented and there is a rationalization.
We welcome this budget and appreciate the Government’s steps to fuel the growth of start-ups in India. (You might also like this)
Pankaj Arora, MD and CEO, Raheja QBE General Insurance
Increasing the FDI limit from 49% to 74% is a positive move for the insurance industry. The suggestions from various stakeholders to further open up FDI in the insurance sector has been considered. The insurance sector invariably needs a huge amount of capital investment which can be done effectively through increase in FDI and it will also enhance the overall performance of insurance sector. Additionally, by announcing Rs 64,180 crore spending plan for healthcare over the next six years will provide a much-needed boost for penetration of health insurance and allow beneficiaries to access quality medical treatment. I firmly believe that this Union Budget indeed as assured by the Finance Minister will lead to aspirational India and economic development of our country.
Zahara Kanchwalla, Co-founder & COO, Rite Knowledge Labs
The focus of this year’s Budget in building digital infrastructure, be it India’s first digital census to micro agri-funds and plug & play textile parks, will benefit the communication and digital industry significantly. The focus on transparent and citizen-friendly initiatives such as one nation, one ration card and faceless resolution will ensure that technology and content are available to more people, giving a fillip to apps, websites, educational content and online platforms.The move to incentivize digital payments will ensure that the acceleration towards speedy, secure and convenient payments spurred by COVID-19 becomes permanent, and helps in enabling a cashless economy. For startups, the tax holiday extension by one year is a big boost to help new businesses accelerate recovery and rebound.
The increased MSME outlay of about $2 billion (INT 15,700 crore) for small and medium enterprises will help digital and content agencies ramp up through investments in people, software and products. I’m glad that the budget has laid the foundation for a modern, digitally safe yet future-ready eco-system. It will help India become globally competitive with a focus on harnessing its intellectual wealth, scaling knowledge-driven industries and building product-centric solutions while elevating small and medium businesses.
Rohitashwa Prasad, Partner, J Sagar Associates
Rupinder Malik, Partner, J Sagar Associates
On corporate governance front, we were expecting the decriminalization under the LLP Act, 2008 and this is a good move to ease the doing of business in India. To relax the compliance burden, the definition of Small Companies is expanded by increasing the thresholds for paid-up capital from ‘not exceeding INR 50 Lakh’ to ‘not exceeding INR 2 Crore’ and turnover from ‘not exceeding INR 2 Crore’ to ‘not exceeding INR 20 Crore’. Further, the Government seems to incentivize the start-ups by allowing One Person Companies (OPCs) to grow without any restrictions on paid-up capital and turnover; the residency limit to set up an OPC is reduced from 182 days to 120 days and Non Resident Indians are permitted to incorporate OPCs.
Apoorv Jain, CEO and CO-Founder at Express Stores
KE Ranganathan, Managing Director, Roca Bathroom Products Pvt Ltd.
The ‘Jab’ will spread to all parts of the Economy body: agriculture getting a big target of 17 lakh Cr funding, urban infrastructure, railways and roadways a major chunk of over 3 lakh Cr allocation, affordable housing with tax breaks, Swacch Bharat with 1.15 lakh allocation, textile getting a big boost etc. On the people side good to see GIG / Platform workers getting protected with better social security benefits. Relief for senior taxpayers from filing returns is in the right direction.
Overall the health of the Indian economy will re-bound faster with this well thought out vaccine
Mohit Dubey, Co-Founder and CEO, Chalo.com
Equally important is the announcement to add 20,000 city buses through the PPP model. India had thousands of operators with decades of experience in running buses. And now, we also have promising start-ups who have built technology for making the bus experience reliable and safe through live tracking and digital ticketing. Overall, this is a fantastic start – with this we have taken a crucial step towards easing congestion, reducing pollution and making our cities more liveable.
Rupa Barua, Managing Partner & Director, The Brand Quest
The focus of the Union Budget 2021-22 was prepared under the circumstances never seen before. The Budget 2021, it’s a mixed bag for us. While the budget vision takes a lead on self-reliance and features every section of society. The extension of tax holidays for start-ups and capital gains will also spark greater capital activity in the investment landscape and serve as an enabler of robust early-stage venture funding for start-ups. In a big boost for startups and incentivize incorporation of one-person companies, such companies will be allowed to grow without any restriction on paid-up capital or turnover and to convert into any other type of company at any time. Apart from this, the government has given a huge aid to home buyers. Presumably, the real estate sector will accelerate. Overall, this is an ambitious, growth-oriented budget and the government has tried to ensure that the economy receives the impetus it needs to go back to a respectable GDP growth level.
Vinaya Varma, MD and CEO, mjunction service
Nikhil Das, Founder, Agdhi
The budget has realized the importance of start-ups in job creation and has extended the tax holiday for startups till March 2022. Already withering under the impact of the pandemic, the announcement has come as a big relief for startups that have become a critical employment generator with 4,70,000 jobs. Such measures are likely to boost sentiments across the board among potential entrepreneurs who are keen on entering the market with their business ideas.
These announcements in the budget were preceded by some welcome news for startups that included the broadening of the definition of startups and approval of the “Startup India Seed Fund Scheme” which comes with a corpus of Rs 945 crore. Overall, the budget has decided on supporting sectors that generate employment and seeks to revive an economy that has been severely hit by a global pandemic.
Dipali Goenka, Jt.MD & CEO, Welspun India
Announcement for setting up of 7 textile parks in next 3 years, in addition to the recent PLI scheme for technical textiles and manmade fibers, promises to strengthen the global leadership of Indian Textiles. The budget proves to be a Strong Enabler of Women Empowerment in the country, with the measures announced by Finance Minister that promotes women working in night shifts across all sectors, with adequate safety.
Saurabh Kochhar, Founder and CEO, Meddo
Health sector has received due importance and we are happy that we are in a progressive and promising space. COVID 19 challenged the health sector across the globe but it’s time for us to see the silver lining. The fact that health is regarded as the foremost pillar of the Union Budget 2021 speaks volumes about the Government’s focus on the sector. 137% increase in healthcare expenditure is the need of the hour.
In a year where overall GDP is contracting, this should take Healthcare spend to over 3% of GDP, up from 1.3%. What is now imperative is deploying allocated funds effectively to further primary health and digitisation. Budget allocation towards vaccines is noteworthy and a step in the right direction. With increased capital infusion / liquidity, it would be prudent to incentivise private players who can become the backbone of healthcare delivery system in the nation and partner the vision of the policy makers and support implementation effectively.
Last but not the least, increased FDI in Insurance can be utilised by the health sector to increase penetration and offer the much needed security and cover for the masses. All in all, budget 2021 is inclusive and promising for the healthcare sector.
Dinesh Chauhan, CEO, CORE Diagnostics
Since it will also be used towards creating modern institutions & labs to cater for detection and cure of new and emerging diseases – the diagnostics industry will have a major role to play and work towards making healthcare more accessible and sustainable. This is a great move towards making healthcare services more democratised and we are committed towards bringing a significant change in the diagnostics space with early diagnosis and outcome-based line of treatment for patients.
Dinesh Aggarwal, Joint Managing Director, Panasonic Life Solutions India Pvt.Ltd.
Reflecting on the continued focus on ‘AtmaNirbhar Bharat’, the Finance Minister has announced extended support for the manufacturing of electronic components & sub-assemblies, including mobile phones. The public infrastructure has got a strong boost with specific allocation for NHAI for continued vigour on highway construction and improvement of the roads; with specific budget allocation for some of the states, including Assam. REIT will be vastly encouraged due to the abolition of dividend distribution tax and, this will accelerate the real estate growth, especially since debt financing by FII has been allowed now. This long-awaited concession will steamroll global funding into India’s real estate sector leading to a large boom in Housing and Commercial infrastructure.
Specifically for the Electrical Construction Materials industry, reduction of import duties on steel flats & copper scrap, long-awaited revision in the labor laws (including women being allowed to work in night shifts) are some of the significant steps that will create a strong export-led economy in the Manufacturing sector.
With special sops in renewable energy, specifically for Solar; the government aims to encourage domestic production by ensuring a uniform policy across the states. Thus, energy generation & domestic Solar module capacity will essentially remain a key area of focus. One expected similar encouragement for EV adoption in India, but perhaps it was not overtly mentioned in the FM’s budget speech.
Focusing on rebuilding India, this is a very positive budget for the industry as the PLI scheme will accelerate growth and encourage global manufacturing companies to create large-scale employment in production and allied areas like product development and design, considering the talent pool which exists across India.
Rajat Singhania, Founder of HyLyt by SocioRAC
The budget is growth-oriented. Govt expenditure on infrastructure is high which will boost the economy. There are no major changes in direct/ indirect taxes. For startups, the tax extension, increase in paid-up capital, registration of one-person firms, NRI permission to incorporate OPCs in India is a good boost to Startups. Overall a positive budget to spur growth, stock markets have responded very positively and we can expect to overcome some of the losses of the year gone by.
Nikhil Rungta, Country Manager, India, Verizon Media
This is a ‘get well’ budget with an expansionary outlook and focused on growth. Given the times it might not be a radical budget, but it is practical and thoughtful, which will propel consumption and growth of business. This budget has also rightly signalled the need for greater inclusion in India’s workforce. Women being allowed to work in all sectors and in night-shifts with adequate protection, and social security benefits extended to gig workers will provide an impetus for women to step up their contribution towards Aatmanirbhar Bharat.
