The pandemic has impacted all sectors and most of them are now limping back to normalcy
Ahead of Union Budget 2021, entrepreneurs across sectors said they believe this is an opportune time for the government to try to rationalise GST rates, compliance processes, FDI policies and ride the buoyancy revenue curves to make it a win-win situation. The pandemic has impacted all sectors and most of them are now limping back to normalcy. In these trying times, backed by government measures and reforms, entrepreneurs shared their concerns and suggested ways to Firstpost about how Budget 2021 could help them get back to their feet sooner.
Rahul Garg, Founder – Moglix
The outlay and the fiscal prudence in the execution stages of the National Infrastructure Pipeline will set the stage for a continuous improvement program for the manufacturing supply chain. It will also be important for the government to consider fiscal incentives for OEMs that source goods made in India from the local MSME supplier ecosystem and unlock new avenues for local demand generation and distribution of industrial goods and manufacturing services.
Rashmi Saluja, Executive Chairperson, Religare Enterprises Ltd
Adequate flow of low-cost credit is crucial at the current juncture as businesses reinvigorate and get back on their feet. This is particularly needed for MSMEs and startups as they are among key growth drivers in the economy. The Budget should look to significantly improve the enabling environment for businesses by ensuring easy availability of working capital, new incentives to boost revenues, hiring and digitisation, quicker refund of GST and easier tax compliance.
Javed Tapia, Managing Director, Clover Infotech
I believe it would immensely help if the Budget can address the MSMEs (a sector that contributes 30 percent to the GDP and plays a vital role in 40 percent of our exports) with incentives to adopt the latest digital technologies and augment growth and operational efficiency. To facilitate this, the government must consider initiatives in areas such as broadband internet penetration and building a secure technology infrastructure to ensure democratic access to digital skills and ubiquitous learning opportunities for our largely millennial population.
Dhruvil Sanghvi, Chief Executive Officer, LogiNext
Global and national supply chain is of paramount criticality in 2021 and beyond. This sector is the backbone of modern civilization and the Indian government should look at ways to simplify global trade. Currently, there is a very high degree of compliance and paperwork which makes it difficult for technology companies to serve the global audience and this forces companies to shift base outside the country. Urgent steps in this direction will help high growth companies keep base in India, generate employment across the spectrum and help revive the national economy after the shock of the pandemic.
Niraj Hutheesing, Founder and Managing Director, Cygnet Infotech
Budget 2021 provides two big opportunities: to boost economic growth by scaling investment in digitisation, drive technology-enabled rationalisation of the country’s tax infrastructure. The former will bring employment and self-employment opportunities for the youth through digital initiatives of Start-ups and MSMEs. The latter will enable businesses to thrive in a simplified indirect- tax compliance regime powered by new technologies like hyper-automation. This will also ensure that the funds collected through GST are used efficiently and help in generating economic growth in this financial year. It is important to have a set framework and policy for GST compliance for all businesses in India.
Shabna Salam, Founder and Director, Maneraa
This being the first Budget post-COVID, we are hoping our government will create more startup-friendly measures to revive the economy, measures like incentives for homegrown brands. Also, we hope that the government shall implement a holistic policy with a regulatory body that oversees the implementation of a favourable environment for the e-commerce sector to sustain and flourish. There should be more clarity on policy guidelines pertaining to e-commerce. We are also sure that this year’s Budget will address the low consumer spending and simplify GST for e-commerce vendors to support small vendors.
Saurabh Singh, Director, Appinventiv
We hope that the finance minister and the government of India takes steps to position India as the IT epicentre of the world by creating advanced policies in favour of the technology industry. At the same time, the government must also create favourable tax policies for 100 percent owned and incorporated companies in India, which are playing a major role in giving employment and bringing foreign funds and helping the economy. With that in mind, we urge that the government considers providing incentive in income tax for the companies which have been generating good employment with consistency.
Kanika Agarrwal, Chief Investment Officer, Upside AI
This year, because the economy is still recovering from COVID, the government has a unique opportunity to make structural changes that will have an immediate short-term impact. A perpetual work in progress, we must focus on jobs, output, and infrastructure spending. We hope the government can refocus its effort on reducing the role and size of government through disinvestment, a reasonable and stable tax regime, and friendlier regulations.
Nikhil Rungta, Country Manager, India, Verizon Media.
I look forward to a progressive Budget with structural reforms that drive consumption and growth. In particular, I see an opportunity for a ‘WIN’ formula focused on ‘Women, Infrastructure and Norms.’ Job market trends show a disproportionate increase in women’s unemployment during the pandemic. This Budget must empower more women to take their place in the workforce, to drive inclusive economic growth. Secondly, we are now seeing even smaller, traditional businesses think digital — the time is ripe to expedite investments in infrastructure, specifically digital infrastructure to increase digital inclusion for Indians across our towns and villages.
Shan Kadavil, CEO and Co-Founder, FreshToHome
We hope this Budget will be about measures to bring about growth and resilience from the pandemic. As we witnessed during the pandemic, a large part of this growth will be brought through bringing in the unorganised players to mainstream business and a key theme will be Offline to Online – O2O. O2O will lead to transparency in payments, transactions, compliance with taxes, labour laws and larger employment opportunities for the youth. Specific to E-Commerce and E-Grocery, we believe this is an opportune time for the government to try to rationalise GST rates, compliance processes, FDI policies and ride the buoyancy revenue curves to make it a win-win situation.
Utkarsh Sinha, MD, Bexley advisors
This needs to be the year for MSME funding. We are looking to the Budget to create additional sops for establishing growth-stage equity funds focused on investing in early growth stage non-tech companies and strengthening the market infrastructure that enables and facilitates transactions.
Mihir Mehta, Senior Vice President, Ashika Capital
This Budget could see the government taking considerable steps in order to expand disposable incomes, especially for salaried class, in order to fuel consumption. The government should seriously look at introducing relaxations and more exemptions in taxation norms like angel tax, withholding taxes etc. in order to encourage Indian investors to invest in startups and at the same time, allow for higher liquidity to satisfy growth aspirations of these companies. In addition, the Budget should also introduce plans to channelize funds from public sector institutions into the startup ecosystem.
Vishal Yadav, CEO, FDI India
We are optimistic that the upcoming Budget will have policies and recommendations that will further strengthen the FDI ecosystem. We hope that this year the government will further look on to strengthening the ease of doing business as it is a basic prerequisite for making investments. It also needs to be favourably allocated to various sectors such as manufacturing, electronics, automobiles, etc in order to boost foreign investments.
Yagnesh Sanghrajka, Founder and CFO, 100X.VC
This year, one of the biggest reforms for startups can be GST rate cuts. Most of the services today attract 18 percent GST, which makes pricing less competitive for a majority of startups. Hence, they are not able to scale optimally. To resolve the same, the government should make DIPP-registered startups a special category for lower GST rates. Bringing the figure down to about 9% should give them good headspace to grow.
Anurag Jhanwar, Cofounder and Partner, Fintrust Advisors
Startups need risk capital and in general, they do not have collaterals to offer in the initial stage, hence, the government should facilitate collateral-free capital. Compliances are another major roadblock, which startups face. It needs to be simplified and to the extent that for the first 3 years startups should be allowed not to file returns. Startups investments should be made eligible for tax rebates as the investments are being put for the building of the nation. Exempting the investments from LTCG and STCG for the early-stage start-ups, provided the money remains tied up for 3 years could also be looked at.
Prashant Joshi, Cofounder and Partner, Fintrust Advisors
The government should contemplate providing imputes to new infrastructure projects, including self-sustainable India – to encourage local manufacturing, thereby leading to more job creation. We expect some steps with respect to revival in the consumption and giving a much-needed boost to the credit growth by providing income tax sops to a salaried class, maintaining status quo or reduction in the cess. With the background of COVID-19 , an increased deduction on medical expenditure for all, as a onetime relief could also be looked at.
Ambika Sharma, Founder and MD, Pulp Strategy
The government can look at SOP for MSME’s adopting technology. This will give a boost to MSME’s as well as to the digital industry. There are many initiatives for small businesses that have been launched in the last two years. I think it is important to refocus on them and set a TAT or improve the efficiency of those policies or systems. Improving efficiency should be of importance.
Vishesh Rajaram, Founder and Managing Partner, Speciale Invest
Our expectation from the Budget is the creation of a level playing field for Indian technology start-ups. Today there is a difference between tax rates levied upon capital gains arising from the sale of unlisted shares and the rates levied on the sale of listed shares. Parity in the two rates will give the startups an equal chance to attract larger amounts of institutional capital based on performance alone. This will also ensure a fair comparison between the two asset classes.
Siddhartha Gupta, CEO, Mercer | Mettl
We expect the Budget to strengthen government‘s focus on ease of doing business in India and for companies looking to do global business from India. The last few years have witnessed a massive focus on data privacy and localisation laws globally, the Indian government needs to create an ecosystem to make India a global hub of data storage and management. This ecosystem could significantly bring down the cost of doing global business out of India particularly for Indian startups.
Chef Sanjyot Keer, Founder, Your Food Lab
The food, hospitality and tourism industry be given a boost by good resources allocated by the Union Budget. I believe that the Budget should allocate some kind of good hospitality services because hospitality is often the field that is left out. Also, recently in Maharashtra, an industry status was granted to hospitality. I don’t know when it’s going to be fully enforced, but if the centre and states work together to give the hospitality industry, an industry standard and infrastructure then obviously electricity prices, loan interest rates and all these kinds of things fall into the industry standard and becomes much cheaper for the hospitality industry.
Nikhil Ramaswamy, Co-Founder and CEO, CynLr
In the next wave of India startups, many will have deep technology elements born out of indigenous R&D and with a potential to serve global markets. Key areas to be focussed on are a)Customs: The current customs regime is not conducive. Most of these components attract customs over 20 percent. Only Exported Oriented Units (EoUs) situated in SEZs can today claim customs waivers and these are inaccessible for startups. B) Foreign Investments: Indian deep tech startups with global ambitions do not attract sufficient foreign investments. As there is a latent trust gap that Indian startups cannot serve a global market being situated in India, and policy changes to address this will benefit the next wave of Indian startups with global ambitions.
Rajan Navani, Vice Chairman and MD, JetSynthesys
While 2020 was affected by the pandemic, it was also the year that made individuals and companies across the board realise the power of technology. To stay ahead of the curve, organizations accelerated digital transformation to reenergize themselves at breakneck speeds in a bid to reset and survive. With the technological disruption gradually becoming a catalyst for traditional and new-age companies, it is expected that the government will make the necessary investments in technology hubs, which in turn will help in strengthening emerging technologies. This year’s Union Budget needs to make way for relevant measures to ensure that the right amount of investment is given to tech build-up, favourable tax policies, and other opportunities.
Arnav Mutneja, Founder, ZinQ Technologies
We expect the government to initiate some Production Linked Incentive schemes to reduce import dependence on China and boost domestic manufacturing. With this, we expect the government to make sure that this initiative to be utilized by both large MNC’s and SME’s. On the R&D front, we also expect the government to allot a Budget for incentives for centers of research and the companies that are investing in breakthrough technologies.
Deepak Mittal, CEO and Co-founder, To The New
Given the current business scenario, we expect a strong push towards policies promoting IT innovation by pushing business-critical and bold policy interventions to propel digital adoption across multiple industries. ‘Digital-first’ and ‘Data-centric’, should be the key focus areas for the Indian government in our view as we push for Digital innovation as an important building block for India’s future growth.
Rakesh Kharwal, Managing Director – India/South Asia and ASEAN, Cyberbit
Union Budget 2021 should concentrate on stepping up cybersecurity measures to safeguard critical infrastructure and Data for financial systems, public health, science, safety institutions, defense, aerospace, and intelligence agencies. This increased focus on cybersecurity further increases the cyber skills gap already impacting organizations globally.
Neha Bagaria, Founder, Jobsforher
We expect the Budget 2021-22 to ensure we create the talent pipeline required to service business needs in this new post-Covid world which has become increasingly digitised. As the jobs of the future become increasingly tech-based, we need to ensure women are equal participants also. The Budget should accommodate for skilling programs for women to upskill themselves in the latest technologies which further helps them contribute to the country’s GDP.
Jatin Jakharia, Co-Founder and CFO, WorkIndia
Since 98 percent of our employer base is SME, we have closely witnessed the economic activity among SMEs. Hiring is 70 percent of pre-COVID levels, implying SMEs haven’t been able to still recover. SMEs are the heart of India; the government can do more to provide more relief so that economic activity among the SMEs increases, which leads to more job creation and which in turn leads to more hiring in the blue collared segment (almost 23.7 cr in India).
Samir Sathe, Executive Vice President, Wadhwani Advantage, Wadhwani Foundation
The government must do three things; improve the capabilities of MSMEs to help them generate demand from large companies; create market access sector-specific platforms in chosen industries of national advantage; and finally treat SMEs and startups with an integrated approach than with a stand-alone one, for the mutually reinforcing system-wide impact.
Dhirendra Mahyavanshi, Co-Founder, Turtlemint
We hope for special relaxations in the Budget for insurance policies for increasing their popularity. Ever since the pandemic struck insurance policies, especially health, became popular and an in-demand product. Increase in Section 80C limit, Increase in Section 80D limit and inclusion of pension plans under Section 80CCD.
Ujjwal Jain, CEO and Founder, WealthDesk
The industry now needs a holistic, unambiguous, and innovation-friendly regulatory regime for the emergence of a BigTech in Financial Services from India. Because multiple entities such as the RBI, SEBI, IRDAI and others govern the fintech space, there can be an overlap of regulation and contrasting views. A single entity or window for regulatory support to tech-intensive fintechs cutting across verticals can avoid confusion and bring much-needed clarity.
Puneet Gupta, Founder and CEO – AstroTalk
The government has taken steps in favour of young startups and MSMEs before and we expect the same from the Budget, this year. The centre needs to encourage entrepreneurship, as this is the best way to generate more jobs and progress economically. Startup friendly policies should be made to easily register a business and provide relaxation in taxes till it reaches a minimum revenue. Make a provision for a collateral-free loan and remove major roadblocks from foreign investments in India.
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