Union Budget 2023 | How industry experts reacted to the Budget

"The automobile industry on Wednesday termed the Budget for 2023-24 as growth-oriented, saying the proposed measures will drive sustainable yet inclusive growth at a rapid pace.
Automobile industry body Society of Indian Automobile Manufacturers President Vinod Aggarwal said a 33 per cent increase in capital outlay with an effective provision of Rs 13.7 lakh crore will spur growth in the economy, resulting in a positive impact on the domestic automobile industry.
"Another appreciable feature of the budget is putting more money in the hands of the individuals by lowering effective personal income tax rates that should increase consumption and consequently lead to more demand," he added. All in all, this is a growth-oriented budget with a positive impact on the auto sector, Aggarwal said.

"Industry bodies in Karnataka have termed the Union Budget presented by Finance Minister Nirmala Sitharaman on Wednesday as "development and infrastructure-oriented" and "one that has something for everybody." Federation of Karnataka Chambers of Commerce & Industry (FKCCI), an apex organisation of industry, trade and service sectors in the State, termed the budget as an overall developmental and infrastructure-oriented one. Stating that this is a progressive, development-oriented and people-friendly budget, FKCCI president B V Gopal Reddy said the chamber welcomes several initiatives announced by the Finance Minister in the areas of millets, health sector, tourism industry, ease of doing business, and the income tax slabs. Speaking about the credit guarantee scheme for the MSME support, he said, "Earlier also, the scheme was there but there was a delay in reaching the beneficiary. This time an additional corpus of Rs. 9,000 crore has been announced for MSME credit guarantee, but we have to wait and see how fast it will reach the beneficiary."

The Focus on AI is a step in the right direction. It'll accelerate the digitalization of the Indian economy, saysSumit Sabharwal, CEO of TeamLease HRtech

"The Focus on AI is a step in the right direction. It'll accelerate the digitalization of the Indian economy. Indian companies in sectors like health tech, HR tech, fintech, etc will compete globally if our human capital is skilled in AI. Tax reform makes complete sense considering the inflation. It'll increase the disposable income in the hands of the Indian workforce; and push the demand in the market. It'll make India stronger to have an accelerated growth."

"Union Finance Minister Nirmala Sitharaman's 2023-24 Budget has provided much-needed oxygen to the MSME sector that was badly affected by the Covid-induced crisis, said industrialists and various chambers of commerce. They expressed the hope that the announcements by the FM will give leverage to the sector.
Vadodara Chambers of Commerce and Industries president Himanshu Patel, welcoming the Budget, said: "The much needed booster dose has been given by the Finance Minister for the MSME, the tax slab will definitely keep the sector floating. It suffered a major setback in 2020."
CII's regional vice president Darshan Shah said: "In the budget many schemes, fund allocations and various schemes have been announced for the MSME sector. It will help the sector to bounce back, which will play a major role in generating employment. There is mild dissatisfaction too, MSME's different industries were expecting reduction in GST tariffs, but it remains untouched."

"The government’s several efforts towards skilling the youth of the nation have been laudable. Pradhan Mantri Kaushal Vikas Yojana 4.0 which will be launched to skill lakhs of youth within the next 3 years will significantly benefit in the overall enhancement and development of the youth in the country. The National Education Policy will enable youth empowerment by facilitating job creation at scale thus supporting business opportunities is a step in the right direction. Furthermore, the pan India national apprenticeship that is a direct benefit transfer scheme to provide support to 47 lakh youths in 3 years will also prove highly advantageous and will enable growth and development of young guns in the right direction.

The launch of a unified skill India digital platform for enabling demand based formal skilling will help the country successfully progress towards becoming a digital savvy nation. Overall, the budget includes significant measures that will help in advancement of the youth of the country, help them become more competitive and secure positions on the global world map.”

"To make the $5 trillion GDP dream a reality, doubling down on digital infrastructure is vital. Hence, the budget should be centred around digitization initiatives that empower the MSME sector. The impact generated would be felt in the improved urban and rural mobility as we see more ports, roads, airports and other infrastructure developing. This will culminate in reducing logistics costs - from roughly 13-14% of the GDP to 8%. The eventual target would be to mark India’s presence in the top 25 countries with the best Logistics Performance Index(LPI)."

"The gem and jewellery industry is hopeful that the government will announce supporting measures and specific schemes for the industry in the forthcoming Budget as it holds huge potential to create jobs and increase exports year on year and become a major driver of economic growth. The need of the hour is to formulate policies and bring transparency that aim at bridging the gap between organised and unorganised players. We are also hoping for a further reduction in customs duty which will regularize prices and in turn, boost customer demand.
Setting up one of the world’s largest gems and jewellery park in Navi Mumbai will be a major boost to initiate new business or strengthen existing ventures and will definitely make India a global leader. Other initiatives by the ministry such as a simplified regulatory framework for gem & jewellery exports through e-commerce, hallmarking norms etc will also go a long way in boosting the growth of the sector. Consumer sentiments have picked up in a big way in the post pandemic era and we have seen a robust demand during the last festive and ongoing wedding season. As the economy grows at a fast clip, we are very optimistic about the diamond and jewellery industry and it will continue to play a significant role in India’s GDP despite several global headwinds.
Overall, the upcoming Union Budget should focus on boosting disposable incomes of the burgeoning middle-class through favourable fiscal policies and beneficial tax regimes that should eventually lead to demand generation and accelerate consumption."

"Among the host of expectations from the Budget, the proposal to increase the FDI limit to 100% in insurance is unlikely be introduced --especially since the FDI limit has just been recently increased to 74%. However, this is a conversation that we must have with the policy makers. 100% FDI will help insurers to infuse fresh capital into the system and secure the next two decades of growth. The Indian economy and the insurance market are both tempting to insurers overseas. But let's also bear in mind that the number of insurers in India is infinitesimally small, compared to our global peers. Part of the problem is the challenge for global Insurers to find suitable local partners. With over 60 insurers between life and general insurance and a large number of them joint ventures, there is really an acute shortage of local partners, who either have the ability or the inclination to get into this space. One can't over state how critical permitting 100% FDI is- it’s a lot easier (or less politically sensitive) for the administration to increase the FDI limit to 100% than it was to increase from 49% to 74%."

"The demand for co-working office spaces has seen tremendous growth, especially in the year 2022, and the post-lockdown scenario is bringing in a wave of new opportunities for co-working players. Medium-to-long-term fundamentals remain sound as companies seek out alternative options to reduce costs and capital expenditure. As organisations are already back in the office, redesigning and restructuring existing office spaces is posing yet another challenge. This is where co-working spaces come into the picture. These shared spaces can respond to design changes required post-Covid quicker and more efficiently than traditional office spaces. However, to drive the growth of this segment, as a PropTech founder I have certain expectations from the upcoming union budget that are mentioned below:

Recognition of the co-working segment under a special scheme: The modern workplace itself has transformed over the years and the concept of co-working is one such example. I feel that government should recognize the industry under special programs like REITs and provide some tax benefits to promote the growth of this sector. The second important thing is the TDS rate that is applicable to the co-working sector. Presently, the TDS rate for the co-working segment is 10% because we provide renting of both movables and immovables. As the shared space industry grows, a lower TDS rate will give this sector a major boost helping companies to provide real estate solutions to clients at economical rates, which will further help in a better flow of working capital. Another important aspect that should be given importance is the financial support to the start-ups as it will help more and more people to pursue their entrepreneurial journey. It will also give a boost to the co-working business as several entrepreneurs who opt for these shared spaces are early and mid- start-ups. I also feel the government should reduce the present rate of registration and stamp duty to register documents. This will give a fillip to both start-ups as well as co-working spaces.

There is also a need for a reduction in the GST rate for start-ups, as it will make a significant impact on their finances. Currently, co-working spaces charge a GST of 18% to all clients, which is huge for new business owners. Finally, I think, institutional capital is crucial to co-working spaces that are dependent on funds for multiple factors. The government should allow banks to provide loans to co-working firms against the cash flow of co-working players along with providing investment benefits to investors of these co-working spaces."

"Our expectation from Budget 2023 is for the government to plan for a long-term sustainable model for MSMEs. Considering the current economic uncertainty, MSMEs struggling with soaring commodity prices and raw material supply disruptions are hoping for some immediate relief. MSMEs need schemes much like the Emergency Credit Line Guarantee Scheme (ECLGS) to tide over the challenging times and meet the rising, time-sensitive capital needs.

With talks of the government taking a renewed focus on the Made in India brand and import substitution, MSMEs will be in a better position to grow and scale their operations significantly. There is also a dire need to introduce regulatory measures that will attract more FDI, which in turn, will boost the economic activities of MSMEs. In addition to the reduction in the corporate tax rates, we also hope for a reduction in the Income Tax rates for Partnership firms, LLPs, and proprietorships which comprise the majority of MSMEs. As very few MSMEs have been able to avail the facility of the recently launched TReDS (Trade Receivables Discounting System), owing to the lengthy process involved—there are expectations to further expand the TReDS facility to cover more MSMEs as well as include certain concessions. As the flow of funds to the MSME sector gets interrupted due to delayed payments, provisions to settle the payments faster as well as enable easier lines of credit for MSMEs are needed."

“With multiple government schemes assisting in the growth of MSME ecosystem, there is an increasing demand for various financial and non-financial services that will help MSMEs in their growth journey. Incentivising these service providers and improving reach to the MSME segment will significantly increase the supply. This will help MSMEs build systems, talent, capacity, infrastructure, access to capital and other ingredients to meet the growth demand.”