The Union Budget 2023–2024 will be presented in Parliament on February 1, 2023, by Finance Minister Nirmala Sitharaman. Every year the budget provides some relief and benefits to different sectors. Here are expectations of different industry players from the upcoming budget.
By – Hiranmay Mallick, CEO & Co-Founder at Tummoc – A public transit app
“2022 was a year of tremendous progress in transit and mobility. There was a significant spike in digital adoption, and a number of new MaaS players entered the market, a large portion of which were EV players.
In 2023, transit in India is going to significantly level up, with seamless solutions transforming the way our daily commuters get around. I can say with confidence that in 2023, a number of Indian metropolitans will get access to a seamless solution to inaccessibility to information, first and last-mile connectivity and the need for digital ticketing. Without getting into too much detail, a revolutionary solution is being built at the moment and will transform mobility in India very soon.
To facilitate this progress, there are certain expectations and hopes from the coming year’s budget such as incentivizing initiatives that promote last-mile connectivity, recognition programs for sustainable/public transport startups to encourage better relationships, carbon trading programs/funds to promote shared and sustainable mobility, incentives for retrofitting conventional vehicles to electric vehicles, etc.”
By – Sravan Appana, CEO at iGowise Mobility – Sustainable Transportation Company
“The union government has been consistently proactive in creating policies for rapid adoption & indigenization of sustainable mobility alternatives for urban air-quality and climate resistance. These new-age sustainable vehicles come with smart connected features that provide us the opportunity to combat a couple of more crucial sticky problems. Road accidents & Traffic decongestion!
Following the national road safety awareness week in January, it is time for sweeping reforms for safer mobility especially for two-wheeler users who are 30 times more prone to road related fatality. 2W are not just a medium of transport, but also a medium of livelihood for 90% of the Indian households. Vehicle telematics, 5G communication, crowd-sourcing data, AI powered analytics etc. provide opportunities to encourage better ride behavior and to identify infrastructure fault lines.
Advanced drive assistance systems provide help in predicting & preempting accidents. Promoting state-of-the-art automobile engineering technologies can help in safer & more stable bikes & scooters. Size & occupancy based congestion road tax models encourage lighter, slimmer & low footprint vehicles for urban commute. Self-driving auto-summon technologies help enable shared mobility for optimal vehicle utilization & traffic decongestion.
India can quickly transform itself from having the most deaths on roads to one of the safest by implementing few simple low-hanging yet path-breaking reforms.”
By- Nitin Raj, CEO and Co-Founder at Riverum
“As someone in a leadership position I always like to keep my outlooks positive no matter the situation and so let me begin by saying that we can expect a lot from the upcoming budget in 2023. Looking through the prism of the past you could say the world is still a little hazy, steadily reeling back to a stable foot. The covid pandemic had our economy in dire straits, it was quite a tough time for every industry out there and Indian tourism industry is no exception. In fact, tourism was one of the worse pandemic affected sectors and we’re bending over backwards to get back in shape but that’s not enough.There needs to be an overall conducive environment in the country where not just the travel industry but every other industry could thrive again and reaching that kind of a favorable point would need not just the industry people but also the government to step in with some proactive measures to help the industry recover. Surely the government is doing something or the other but I believe that they can do a lot better. How about providing tax breaks, slash GST rates, and offer incentives to make the industry more competitive? These aren’t out-of -reach solutions, are they? Tax reductions would facilitate Indian travel companies to invest in their businesses and compete with their global peers. This in turn is bound to reflect in the GDP anyway; and let’s not forget the opportunities for job creation and making travel more affordable for tourists. So, you see, the whole cycle will help not just the industry per se but also the government in terms of increased tax revenue and reduced unemployment. I’d also like to turn the industry’s attention to sustainability. It is high time the government along with the industry seriously consider and act on the environmental impact of the travel sector.
We need to move towards more sustainable forms of travel, while ensuring that the industry remains profitable. Introducing green tax incentives for instance or providing subsidies to travel companies that are investing in green technologies would be great steps towards a green sustainable yet still profitable future. While all that is covered for consideration, we must remember that we are an ever evolving world and that is true for the industry as well. There’s always a need to constantly change and evolve for the better – here, the Indian Government could take on a big role in investing in research and development of new technologies that could boost the travel industry. As a leader in the travel sector I would like to put this hope out that the government will provide grants and incentives to tech companies and scientists to come up with innovative solutions to elevate the travel sector.”
By- Paavan Nanda, Co-Founder, WinZO games
“The online gaming industry has the potential to scale rapidly and become a significant contributor to the Government’s vision of a trillion-dollar digital economy. The industry is currently in its nascent stage, and needs stability and clarity from a tax and compliance perspective. The proposed 28 percent GST on the Gross Gaming Value of all games played, over the current 18 percent on the commission of the gaming companies, would have an existential impact on the segment. Further, a reduction in the TDS threshold, from the current winnings exceeding INR 10,000, could also impede the growth of the industry. The TDS liability on winnings above 10,000 already stands at 30% under the Income-tax Act of 1961. The increase in GST and TDS cumulatively would completely wipe out the homegrown industry that has the potential to be the largest next generation of exports of consumer tech products made in India for the world. In this budget announcement, we are hoping to see a continuation of the current GST slab and TDS threshold as a sharp increase in tax will deter growth, sink early-stage startups further into losses and overall make the industry unviable. A clear and supportive tax policy will not only generate revenues for the exchequer but will also create great value in the long run for the country and the gaming ecosystem.
In last year’s budget, the government recognised the gaming sector as one of the potential segments for job creation in India and set up the Animation, Visual effects, Gaming, and Comics (AVGC) promotion task force to realise the potential of the segment. We are hoping for the announcement of constructive action in that direction to give a boost to the gaming industry.”
By- Vishal Bhatia, CFO, Balancehero India
“2022 saw India becoming one of the fastest growing countries in the world. The wave of innovations, exponential growth, and large-scale digitization of the financial sector has also had a positive impact on financial inclusion. The future holds tremendous potential, with the industry’s market size predicted to reach $150 billion by 2025 and $200 billion in revenue by 2030. To continue this momentum and strengthen the economy further, we strongly believe the government must adopt some specific measures in the upcoming Union Budget. A very strong focus needs to be laid on priority sector lending- credit access should be granted to those who are otherwise deprived of the facility. In other words, measures should be directed towards ensuring that market participants have enough liquidity to support the new to credit customers. Further, the government should implement the necessary measures for improved partnerships with banks.
We expect that the budget will contain supportive initiatives that will enable cutting-edge lending systems that can guarantee high-quality performance while preparing for the upcoming wave of transformation. The government should broaden the eligibility criteria for tax reliefs to start-up employees to alleviate the tax burden that Employee Stock Ownership (ESOPs) borne by them. While the industry is working on providing direct benefits to borrowers of personal loans in the form of tax benefits, they demand indirect benefits for the fintech sector to be empowered with the ease of doing business. This would ensure that lenders extend these benefits to end users. The government should allocate funds to stimulate the creation of new ideas that would foster paperless digital lending and stronger partnerships. To improve customer and business experiences, credit quality, and expedite the expansion of financial organizations, we anticipate that the government will place a greater emphasis on the creation of digital infrastructure.”
By- Jagdish Mitra, Chief Strategy Officer & Head of Growth, Tech Mahindra
“The year 2022 has been a transformational year for India and for the world. We witnessed disruptions in India followed by recovery and revival. India also emerged as a fast-emerging developing country and a ‘bright spot’ in the global economy. I believe, in order to maintain the growth trajectory, the need of the hour is to further push the development of the technology ecosystem through a tech-driven, forward-looking budget. We look forward to seeing focused initiatives to boost consumer sentiment, improve Ease of Doing Business (EODB), strengthen infrastructure, and promote investment in critical areas including healthcare, network modernization, skilling & job opportunities, and financial inclusion. We hope the upcoming Union Budget 2023 will be a beacon of hope for creating National R&D Ideas Incubators, which will nurture critical cross-disciplinary research, new ideas, and technologies through the early phase. Encouraging joint collaborations and ownership by industry and academia, along with centers of expertise will also be a welcome experience. The IT sector is poised to play a crucial role in fulfilling the Government of India’s vision and mission of ‘Make in India’ for the world, – all it needs is a final push – which the upcoming Budget could grant.
In light of the upcoming Union Budget for 2023–24, India is eagerly looking forward to the policy announcements and allocations designed to support startup ventures and the entrepreneurship sector in the country. With the ongoing funding winter, it is especially crucial for organisations to receive comprehensive support from the government in streamlining and easing funding avenues and increasing accessibility for all. To reinvent the technology-based underwriting experiences and infrastructure and shorten the time to funding underprivileged MSMEs, Indian fintechs would require more collaborative partnerships with banks and NBFCs, similar to consumer fintechs. When dealing with such requests, regulatory authorities must design policies and initiatives for fintechs with a nuanced understanding of their position as regulated organizations, in order to fully appreciate their potential.
Having described Artificial Intelligence as “sunrise opportunity” in last year budget, the Finance Minister has emphasized the importance of AI from the government’s view point. With the IOT, 5G and Robotics emerging together, the AI on the edge and cloud will significantly push the frontiers further and further in all areas of industry, agriculture and services and most importantly will position India as a state-of-the-art manufacturing power-house of the world.
We being a leading camera module and vision solutions company, work with start-up and established companies across the world who are disrupting the industries. Our cameras are being used by agricultural autonomous tractors, warehouse AMRs, delivery robots, autonomous/smart retail checkout, patient care, precision agriculture etc which are changing the industry landscape and these changes are culmination of sensing, edge-AI processing and internet connectivity. We see that Indian industry is also aspiring to develop our own technologies along these lines and this requires a significant amount of core research and development. We hope that finance minister rolls out some new schemes that will encourage industries to invest in core R&D on AI and Robotics that will unleash India’s technology potential and will accelerate the goal of USD5 trillion economy by FY2025, an ambitious target set by our Prime Minister.
Ankur Nijhawan, CEO, AXA France Vie—India Reinsurance Branch
“We anticipate the upcoming Budget will focus on policies to promote economic growth and pandemic resilience. Given the recent increases in health insurance premiums and the need to provide basic financial protection against natural catastrophes such as Joshimath, the insurance industry is expecting a combined tax relief of up to Rs1 lakh for health and household insurance.”
“The industry also hopes the Finance Minister will bring these basic protection plans under the zero GST mark or tax it in the 5% bracket at the most. While widening the financial protection net, such a move would also increase insurance penetration in India. Easing norms and providing help in the form of tax benefits could go a long way in opening up the segment to the currently underserved and unserved sections of the population.”
Nitin Singhal, Managing Director, Sinch India
“India’s budget for the upcoming fiscal year is highly anticipated, as it is expected to focus heavily on technology and digital infrastructure. According to a recent report by PwC, the country’s digital economy is projected to grow at a CAGR of 11.5% to reach $1 trillion by 2025. This growth is driven by increasing internet and smartphone penetration, and government initiatives such as Digital India and Make in India. I anticipate that the budget in 2023 will announce further support for the development of the digital economy by investing in areas such as 5G technology, artificial intelligence, and cybersecurity. Additionally, I am looking forward to the plan regarding the allocation of funds for the expansion of digital infrastructure in rural areas to bridge the digital divide and promote inclusive growth. Overall, I believe the budget is expected to set the stage for India’s continued growth as a major player in the global technology industry.”
Shyatto Raha, Founder and CEO of MyHealthcare
“India’s healthcare system was put to test both during and post the pandemic. Health institutions took a major financial hit and this catalysed the need for adoption of technology across the sector to manage their patients. The recent announcement of financial incentives (Digital Health Incentive Scheme) by the Government of India, will help in strengthening the digital health infrastructure through ABDM (Ayushman Bharat Digital Mission) and provide a much needed focus on healthcare digitisation & digitalisation in India. The Ayushman Bharat insurance programme has also helped Indians get access to quality healthcare and pushed private healthcare providers to deliver care to a wider population. The recently applied GST for in-patient billing in hospitals has added to their already pressured operating margins. We would request the government to consider providing tax rebates, subsidies or any form of incentive schemes that would ease the financial burden for health facilities who are looking towards digital transformation for better healthcare delivery. Furthermore, to fuel start-ups who are supporting the digitalisation of healthcare, we seek the government’s support in removal or reduction of GST applicability, making our services more effective for healthcare providers. This will help boost the adoption and accessibility of digital healthcare and accelerate India’s digital health agenda including data interoperability, personalised healthcare and improve the quality of healthcare delivery in India.”
Ashish Rai, Vice Chairman and President, Aurionpro Solutions
“India has been leading the world in building its own technology industry as well as talent base. We are relentlessly marching towards being the de facto top choice for setting up scale technology and capability centres. I believe the Indian tech industry today stands on the cusp of the next leg of explosive growth and transformation from being a global IT service and outsourcing leader to becoming an IP-led software products and platforms powerhouse. In this year’s Union Budget, it would be a welcome step if the Hon’ble Finance Minister announces initiatives and incentives that will give an impetus to make-in-India software products and platforms, thus creating the next generation of global leaders. The game-changing success and global renown of the Indian stack and platforms such as Aadhaar and UPI should give us a lot of confidence in India’s ability to lead the world in creating IP-led, global-scale platforms. This will significantly enhance our economic growth and global influence.
From the standpoint of specific technology areas to focus on, if I had to pick one area where it is absolutely imperative for India to focus efforts, it has to be Artificial Intelligence (AI), where the difference between the AI-haves and have-nots will likely be stark. Considering India’s long-term progress and security, it is imperative that Indian industry and government institutions focus intensely on taking a leadership position in the building and deploying AI on a global scale. A well-thought-out initiative that provides an enabling policy framework, as well as industry incentives in this area, would be very welcome.”
Given India’s commitment towards meeting Net Zero targets and to balance massive US subsidies under Inflation Reduction Act- we expect government to announce scheme to keep manufacturing of EV batteries, solar panels etc, in India.
Government announced an ambitious Scrapping Policy for old vehicles- but response has been lukewarm. We expect Finance Minister to announce a larger budget to kick start this program and offer sops to vehicle owners as well as scrapping facility providers.”
Maulik Patel, CMD – Meghmani Finechem Ltd.
India has tremendously benefitted from the ‘Plus One Strategy’. With the right thrust from the Government, we can build on our capacity and become competitive for exports in important sectors such as manufacturing and chemicals.
The chemical industry has recently come under external pressure due to changing geopolitical hegemony. Despite this uncertainty, there has been a surge in demand for certain specific chemicals internationally and domestic markets. In this scenario, India is well placed to seize the momentum to meet these requirements. Moreover, in the next five years, we expect a steep rise in domestic consumption owing to the size of India’s population. Certain conducive factors need to be in place for the Indian chemical sector to emerge as globally competitive.
I expect the Union Budget 2023 will consider introducing measures such as incentivising the sector with PLI schemes, evaluating import duties on a few key substances to boost production and entering into FTA agreements considering interest all the industry, including chemical industry. Another aspect where government intervention can help enhance the chemical sector’s output is energy. Energy remains a crucial for manufacturing segment and hence the Government can introduce centralised policy for energy in the upcoming union budget.
To achieve this, the focus needs to be on building global-level infrastructure, creating more regions like Dahej PICPR and centralised policy for energy, so that we can redirect many value chains in their entirety to India. This will stimulate not only our economy but also upturn niche industries.
Dr. Ajay Ranka – CMD, Zydex Industries
Infrastructure with goals of sustainability will be the key pillars of modern economy. India being a multi segment economy must focus on sustainability in energy, petro-chemicals, minerals, agricultural lands, forests etc.
Innovative policies and targeted incentives can nudge the economy to be on a consistent growth path which can be sustained in the entire century. Net zero goal of 2070 and prudence in achieving the same at the lowest cost with inclusive growth should be the key focus of our economic policies.
Most of the GST on construction raw materials is denied credit in the economic activity and so lower rates would help. Production Linked Incentive (PLI) like schemes should be pursued to energise more manufacturing and job creating activities to give buying power to the working consumers and control the current account deficit by importing less and exporting more.
Quality of current infrastructure being built is an area of concern. Poor audit practices, accountability and mal-practices can be addressed by creating a multi-layer quality assurance system almost on the lines of the faceless income-tax assessment. This can reduce the depreciation cost of the new infrastructure built reducing the future cost of repairs and replacement.
Deepak Jain, President of Grew Energy Pvt. Ltd.
Energy production and its sustainability are the two major issues of the recent times. India has the potential to become ‘the green sparrow’ of the world and offer quick, affordable renewable energy solutions if we put our act together.
The government has shown its commitment for mainstreaming renewable energy by introducing policies such as Production-Linked Incentive Scheme-II (PLI-II). However, when we are talking about developing close to 100GW of solar manufacturing capacity by 2030, we need a much more conducive environment.
Domestic content requirement needs to, essentially, be made compulsory for subsidised as well as non-subsidised projects. This will immediately shoot up our growth trajectory. In the Union Budget 2023, the Government can think about centralising solar installation policies which will boost installed renewable energy capacity, in order to achieve the goal of 500GW installed capacity by 2030.
Vinay Thadani – CEO, Vishal Fabrics Ltd.
Despite supply-chain disruptions during and post Covid-19 pandemic, the Indian textiles and apparel industry has shown tremendous resilience by spinning a turnaround with innovation. However, the sector has been under pressure for some time now owing to its less advantageous competitiveness in export markets.
In the upcoming union budget, if the Incentivisation Scheme for Producers and Exporters is efficiently introduced and implemented, it will tremendously boost confidence among our biggest buyers – UK, US and EU, to choose us. As these markets attach a lot of importance to traceability & sustainability of fabrics, it calls for larger investments in the R&D for technological innovations to achieve them. Upgradation of technology would also lead to much-needed development in infrastructure. I hope that the budget will also look into revising textile duty to spur more exports
The biggest pain point for Textiles was import of costlier cotton when we should be going for Indian produce. The government needs to work towards achieving international status for Indian cotton. It can also consider implementation of Cotton Price Stabilisation Fund Scheme which will not only boost exports but also result into around 3% of additional industry growth.
Lastly, we need region specific textile hubs, especially of mid and small size, to optimise craftsmanship, skillset, resources and marketing efforts. This will not only promote traditional techniques but will also serve as a benefactor to some of the less developed districts of India.
Prof (Dr) Sanjiv Marwah, Director Maharaja Agrasen Business School, Delhi
“Suggest that this year’s budget is expected to focus on Inflation challenges.
He expects the new education policy to kick off in India in the coming year and therefore the Govt is expected to make this budget education outcome-oriented.
He expects the government to provide ‘Internship payments’ to be offset against CSR funds or towards research expenses to provide impetus to industry-academia collaboration.”
Punit Sindhwani, CEO, Paxcom
“With increase in penetration of internet and smartphone usage in both urban as well as in rural India, the e-commerce space is mushrooming day-by-day in India. A 2022 RAI report predicts that online shopping in India will increase from its present 7% share of the retail market to over 19% by 2030.
eCommerce has revolutionized the way business is done in India. It has fueled consumption in recent years by providing easy access to end-users and has created numerous new job opportunities. What truly pushed this eCommerce sector to the next level in India in the past few years was the government’s intervention and initiatives taken on the technology and digitization fronts. These have given a boost to technological innovations, new modes of digital payments, and the development of local logistics support.
Though the eCommerce sector has blossomed from infancy to maturity, it is still grappling with pre-dated laws that are not apt for its nuanced and evolving requirements. The government is already taking steps to build an updated regulatory structure for eCommerce, and we expect the budget to further build on the same. The upcoming budget is expected to provide financial and regulatory support to the digitization of Small and Medium businesses, as well as Tier 2+ cities, as a major chunk of new eCommerce growth is expected from there. The government should also strongly focus on building the right support infrastructure for these segments for the eCommerce sector to truly accelerate and help realize the vision of digital India. The ONDC initiative is a step in this direction and we expect the budget
We also expect that the government will provide clarity on the tax obligations of e-commerce companies, sellers, and brands, as it will help them further streamline their operations and contribute to industrialization 5.0.”
“As a startup builder, we would expect some bold initiatives by the government to encourage more participation of small check investors as angel investors in the ecosystem. This could be in the form of tax exemptions on returns from investments, as already the investment is risky in this asset class, so an incentive in the form of tax rewards would work as a catalyst.Also, for startups, a tax exemption slab increase in GST would be a big step. Moreover, more active participation of government supported Incubations and seed funding would bring a lot of pace in the Tier 2/3/4 cities startup innovation.”
