Union budget 2023 has been announced, and industry reactions have already started to trickle in. The initial reactions are mainly positive, and some of the moves that are being widely appreciated are the reforms on the tax slabs, the emphasis to artificial intelligence and the initiation of the National Data Governance policy. The initiatives announced for MSMEs are also being widely appreciated.
“MSMEs are the development catalysts for the Indian economy, and the government did a great job with this budget in not only extending all forms of support and protection to the MSMEs but also encouraging further scaling of businesses. The setting up of Entity DigiLocker, launching of a new sub-scheme of PM Matsya Sampada Yojana with a targeted investment of Rs. 6,000 crores, and facilitating e-commerce for MSMEs is worth lauding. The redesigned program, which will go into effect on April 1, 2023, thanks to an injection of Rs. 9,000 crores into the corpus, was the major feature. This will provide for an extra Rs. 2 lakh crore of collateral-free guaranteed loans. Additionally, there will be a 1% reduction in the cost of the credit. Through these policies and schemes, the MSMEs will not only contribute to “Make in India” but also to “Make for the World” as envisaged,” said CS (Dr.) Adv. Mamta Binani, Past President ICSI & President of MSME Development Forum WB on the Union Budget 2023.
Along similar lines, Susheel Tejuja, founder and MD, PolicyBoss.com, said: “The budget is indicative of the continued economic growth resolve that the government has underlined via a slew of reforms, rebates and announcements all aimed at turning India into a consumption economy. Increased infra push of 10 lakh Crore will boost trade and transit economy alike, resulting in rapid growth corridors fueled by public infrastructure spending. Announcements regarding Tax Reforms and rebates for companies incl. tax implications, unified filing, ease and transparency in data access and governance, with focus on MSMEs underlines continued government efforts in ensuring ease of doing business and boosting entrepreneurship across industries. Direct Tax reforms with revised tax slabs under new Tax Regime will benefit masses, yielding higher take-home salaries. Simplified tax filing will further boost individual tax payer confidence. From insurance perspective, announcement revision of tax exemption limit from proceeds of high value insurance policies is noteworthy as insurance companies typically receive 12-15% of their overall premiums with individual premiums of Rs 1 Crore and above. As further details emerge, one will get more clarity on exact specifics. Increased infra push augurs well for general insurance companies as new project insurance related opportunities will get created. For senior citizens, revision of limit to 30 lakh will help get better reruns on higher saving amount. This is a positive development for LIC and Post Office. To sum up, this budget is forward looking and progressive, with the common man benefiting from Ease in Access to Quality Education, Housing and Skill Development and Enhancement while boosting economic growth and spurring entrepreneurship.”
On the emphasis given to AI, Tapan Barman, CEO and Co-Founder, Mihup, said: “It is encouraging to see the government identifying AI as a key technology of focus in this union budget 2023. As an organization working in this space, Mihup welcomes the emphasis on Make AI in India, and Make AI work for India frameworks. We have always maintained that AI integration holds the key to transforming service levels and outcomes. The decision to set up 3 Centers of Excellence for AI research, and development in collaboration with private sector players is bound to expedite AI adoption in areas like healthcare, sustainable cities, urban management, and sustainability initiatives. We will not only see home-grown technologies make greater impact on all aspects of life, but also create a lot of jobs. The decision to set up AI-specific training centers is going to help a larger number of youths in acquiring future-ready job skills and enable AI-based companies like Mihup acquire better talent with greater ease. Alongside the announcements towards ease of doing business such as reduction of 39,000 compliances and de-criminalization of over 3400 legal provisions, the government has also taken several startup friendly steps. This includes simplification of direct taxes and collaborative approach to AI development. All these will surely play a key role in India’s technological development and overall economic growth.”
Suhas Rajkumar, Founder and CEO, Simple Energy, said: “The budget for FY24 announced by FM Nirmala Sitharaman is encouraging on a lot of fronts, especially in the space we operate in. One of the key focus areas is Green Growth and the schemes announced are promising and we welcome the optimism ignited by the Finance Ministry in this space.These progressive schemes will surely enable rapid electrification in the country and encourage consumers to transition seamlessly towards green mobility which will help OEMs to script a robust growth story in the domestic market. Furthermore, we congratulate the Government of India on laying down its aim of reaching net-zero carbon emissions by 2070. We will work in alignment with the GoI’s aim to maximize growth opportunities in shaping a greener tomorrow.”
In addition to the above mentioned initiatives, Kishan Tiwari, Co-Founder and CEO, TSAW Drones a drone tech startup said, “The Hon’ble Finance Minister’s announcement in the Union Budget 23-24 to revitalize 50 additional airports, heliports, water aerodromes, and advanced landing zones is a landmark decision. This will jumpstart the fourth industrialization by effectively utilizing drone technology for automation in logistics, transportation, infrastructure, and rural development, as well as create new-age jobs for the nation’s youngsters. TSAW is committed to supporting the government’s mission by assembling state-of-the-art ‘Made in India’ drones and DRONECO is committed to providing end-to-end drone services for internal sovereignty, last-mile connectivity, agriculture, healthcare and others. The announcement of the Agri Accelerator Fund by the government will encourage more entrepreneurs to serve Indian rich and heritage agriculture Industry. Being a Drone manufacturer, TSAW sees a big opportunity of collaborating with Agri start-ups to serve and show a real case of Drones in the Agriculture.”
Arvind Bali, CEO, Telecom Sector Skill Council, on the other hand praised the government for the skilling initiatives announced in the Union Budget 2023. “The government’s focus on the skill development of India’s potential youth talent through initiatives like NEP, PMKVY 4.0 for skilling in niche new-age technologies like 5G, AI, 3D printing, drones, coding, mechatronics, robotics, and IoT draws further impetus to the ongoing efforts. Blue and grey-collar job demand in India grew by up to four-fold in 2022. Annual demand in telecommunications and 5G have increased by 33.7 per cent in September 2022. There was a demand for 1.3 million workers in FY22-23 which is growing each year and. New use-cases including cloud computing, robots, and the Internet of Things (IoT) are also seeing a sharp rise in hiring. We believe the initiatives will be beneficial to close country’s growing demand supply gap of technical talent workforce. With the government’s push to establish 30 Skill India international centres, 100 premier labs for developing applications to use 5G services, and centres of excellence for AI, India has the potential to deliver talent not only across domestic markets but also to the international market. The initiative like the Eklavya Model Residential Schools (EMRS) is also a progressive move by the government to uplift the tribal population and empower the students to take up new job opportunities,” he said.
Sonali Kulkarni, Lead – Financial Services, Accenture in India, said: “The focus on improving credit access and creating digital public infrastructure for agriculture along with the existing Agri-stack (India Digital Ecosystem of Agriculture ) will unlock new growth opportunities for agri-tech SMEs and entrepreneurs as well as farmers. Access to granular data via these digital initiatives will enhance access to agri-credit for this segment and also drive new business models for banks as a result of better credit discovery and risk management. The extension of the Digilocker facility to enterprises and MSMEs, KYC reforms, a more integrated approach towards identity management processes, and ongoing innovations to the India Stack will help banks, NBFCs, and fintechs to underwrite better and more efficiently. Even though clarity on the exact contours of the National Financial Information Registry is awaited, it seems to be a step in the right direction towards more efficient and transparent access to credit. Finally, the expanded credit guarantee scheme for MSMEs will be critical to continued economic growth across industries and expanding employment opportunities.”
Rushabh Gandhi, Deputy CEO, IndiaFirst Life Insurance Company Ltd, said: “Rationalization of the Income tax slabs and of the peak tax rate will result in higher disposable income in the hand of the individuals. This will help boost financial savings and have a direct benefit to insurance sales. The insurance regulator’s mission of “Insurance for all by 2047” will get a further boost because of the exemption of stamp-duty on PMJJBY. This exemption will reduce the burden on life insurers sourcing PMJJBY policies and prompt them to procure incremental business. Finally, it has been proposed that, effective 01st April 2023, if the premium on a non-ULIP policy exceeds Rs. 5 Lakh, then it will be taxable under “Income from Other Sources”. For IndiaFirst Life, non-ULIP policies exceeding Rs. 5 Lakh of premium has a single digit contribution to our overall business and the impact is expected to be muted.”