Finance Minister Nirmala Sitharaman has presented the Union Budget 2021-22 in Parliament. Significant changes to the taxation process, Sitharaman announced the scrapping of income tax for senior citizens under certain conditions, new rules for removal of double taxation for NRIs, and a reduction in the time period of tax assessments among other measures. Startups will get an extension in their tax holiday for an additional year. Sitharaman also announced that the advance tax liability on dividend income shall arise after the declaration of payment of dividend. At the conclusion of her speech, Sensex was at 47451.62, up 1165.85 points. Let’s look at the reaction from Industry Experts:
Udaya Bhaskar Rao Abburu, CEO & Managing Director, iRAM Technologies
We expected more from the Union budget 20-21. While the focus has been on infrastructure, FM has allocated Rs. 93,400 Crores for roads only, no allocation has been made for the development of Smart Cities. Though FM talked about double-digit growth of the manufacturing sector for India to become a $5 Trillion economy, no roadmap has been laid out for the same. We also need more clarity on how Rs. 2217 Crores allocated for setting up 42 Urban centers to tackle the pollution problem will be used. Change in definition of Small companies may benefit some Small-scale companies, provided more support for Small scale companies are announced.
Lalit Mehta, Co-founder & CEO of Decimal Technologies
The budget presented seems to tick most boxes that India needs today post COVID. The promise on CAPEX should help in generating employment and also solve for long-term growth objectives. The six pillar focus will set the foundation for growth in coming years and make us better prepared for difficult situations like the COVID.
Some of the items that would see effect faster than others would be the FDI cap increase for Insurance, which will surely lead to a better-capitalized Insurance sector and better reach of Insurance to the masses. Privatization of PSBs is a welcome move. It should help in making the banking sector more agile and oriented towards digital growth. This should lead to a few acquisitions of PSBs by private lenders. Hopefully, this will increase the reach of the private sector to rural markets and will enable these markets with new products and a digital ecosystem. The fintech hub in the GIFT city is a great step towards enabling the fintech industry and shows the government’s recognition of FinTech as a significant play in the financial sector. This should set the road for the creation of the required regulations and frameworks for FinTech to work with conventional lenders and banks.
Fiscal deficit and achievement of divestment targets is something that needs to be under close watch. Any slippage on any of these can put a spanner in some other initiatives. Overall a positive budget that tries to balance between long term and immediate needs.”
Ashraf Rizvi, Founder & CEO of Digital Swiss Gold & Gilded
“The Sensex witnessing a rise of over 4.5% signals the positive sentiment towards the Union Budget 2021. The gold and silver market received good news with a rationalization of import tariffs. The reduction in import duty on gold and other precious metals from 12.5 percent to 10 percent, will make jewelry cheaper in the domestic market for the buyer, as India continues to be the second-largest buyer of gold in the world. Moreover, the announcement of SEBI as the regulator for gold exchanges in India is also a welcome move as it hints at deeper regulation of digital transactions of the yellow metal, which is critical to earning consumer trust. Overall, a very positive shot in the arm for the Indian economy that looks to help India and its citizens recover in 2021 after a very difficult 2020. We at Digital Swiss Gold and Gilded will continue to ensure savings to our customers so that more investors consider gold as a critical asset in their investment portfolio.”
Venkatraman Narayanan, MD & CFO, Happiest Minds
The budget has maintained continuity and consistency and in line with the themes of ease of doing business, simplification, transparency, and manage effective delivery through digital channels. As a digital company hearing announcements around leveraging digital technologies like video conferencing, e-assessments, e-invoicing, AI, and ML for governance, incentives for digital transactions are heartening.
Honorable FM has maintained the course on simplification and consolidation of laws with a specific focus on rewarding the honest. The aspect of supporting the economy with increased spends on Infra, health, farming, and education are welcome. Inclusion and women empowerment into the larger Aatmanirbhar objectives of the government are laudable. I see lots of support for the economy and a V-shaped recovery for the economy. From the IT industry perspective, quite a few relaxations on compliance, laws, and also support came from the Government during the Pandemic. Hope this approach will continue.
George Rajkumar, Country President, Grundfos India
Grundfos India welcomes the additional allocation towards the Jal Jeevan Mission (JJM) by the Department of Drinking Water and Sanitation announced by the honorable Finance Minister. Given that the budget had a very sharp focus on the sustainable economic growth of and the nation overall, it was great to see the focus on one of the crucial issues, that is urban water supply. Keeping the growing water crisis in mind, the decision to dedicate an INR 2.87 lakh crore outlay over 5 years, for the renowned JJM, which is aimed at a universal water supply in all 4,378 urban local bodies, with 2.86 crore household tap connections and liquid waste management in 500 AMRUT cities is a good one. The move to include liquid waste management backed by the budget allocation of ₹ 1,41,678 crore for Urban Swachh Bharat Mission 2.0 is a great step forward to holistically look at sustainable water and wastewater management in India. We hope that this allocation will encourage public and private players to develop innovative solutions for JJM and provide an opportunity to contribute to resolving water issues in the country through advanced water technologies. Furthermore, knowing the fact that we are rich in renewable sources, it is a rational decision to evidently level up the renewable energy allocations, by proposing an additional infusion of INR 1,000 crore to the Solar Energy Corporation of India and 1,500 crores to IREDA continuing to build on a solarized future.
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