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“This budget went beyond the expectations from a vote on account, unlike the 2019 budget, which was also an election year budget.”

Union Finance Minister Nirmala Sitharaman presented the Interim Union Budget 2024 ahead of the Lok Sabha elections in 2024. This is the final budget of the second term of the Modi government.

Here are the reactions from some of the industry leaders and think tanks:

Anuj Puri, Chairman – ANAROCK Group
As anticipated, the Interim Budget 2024 made no big-bang announcements, but it continued its focus on infrastructure upgrades and building connectivity across the country. This will benefit real estate growth in not just the top cities but in Tier 2 & 3 cities across the country. The FM made some announcements that will go on to benefit the sector both directly and indirectly:

PM Awas Yojana (Gramin) – Despite all the challenges, the implementation of this scheme continued, achieving the target of close to 3 crore houses and now aims for 2 crore more houses to be taken up in the next five years.
Housing for the middle class – The Government will launch a scheme to help deserving sections of the middle class, living in rented houses or slums, or chawls and unauthorized colonies, to buy or build their own houses. This is likely to free encroachment areas like slums for easier redevelopment.
Capex outlay allocation to be increased by 11.1% to INR 11,11,111 lakh Cr, accounting for 3.4 % of GDP – This will unlock the potential for real estate development across assets because major part of this allocation will be used for various infra upgrades and new projects.
Transit oriented development in urban areas – this may give a boost to housing demand in cities and lead to rise in residential prices.
Development of iconic tourist centres – this is likely to favourably impact the hospitality sector with hotels and restaurants across categories. Moreover, long-term loans proposed to states for tourism.
Extending tax benefit to startups for another year – this may help the office real estate to rejuvenate.Key Unmet Expectations
Industry status: The industry has been requesting industry status for years, believing it would unlock benefits like easier access to credit, tax breaks, and infrastructure development. This wasn’t explicitly addressed in the interim budget.
Tax benefits: Tax incentives for homebuyers, such as increasing the deduction limit on home loan interest under Section 24, were expected. The interim budget remained silent on this as well.
Affordable housing: Boosting allocations for schemes like PMAY (Urban) to improve affordability and encourage new projects in this segment was a key expectation. No major announcements appeared in the interim budget regarding this either. Dr. Jaijit Bhattacharya, President, Centre for Digital Economy Policy Research
“This budget went beyond the expectations from a vote on account, unlike the 2019 budget, which was also an election year budget. Besides focusing on vulnerable sections of society, targeting saturation of schemes, there is also intense focus on research and innovation with very significant outlays for supporting research in the private sector, with very low cost loans. The focus on infrastructure has accelerated with increased outlays in Railways, promise for more airports to accommodate the growth appetite of airlines, dedicated commodity corridors for freight, sea port and river port infrastructure and also significant focus on digital public infrastructure as well as continued focus on housing for all. Overall, the budget signals the government’s intention to continue to generate demand in the economy through spending in social, physical and digital infrastructure and by providing enhanced support to vulnerable sections of society, thereby also increasing domestic demand.”

Dr. Sat Kumar Tomar, Founder & CEO, Satyukt Analytics
“The Budget 2024 has resonated positively with the agriculture sector, aligning with our expectations for a technologically driven, sustainable farming approach. While the integration of IoT devices for precision farming wasn’t explicitly mentioned, the focus on farmers is evident. Crop insurance coverage for 4 crore farmers under the PM Fasal Bima Yojana ensures risk mitigation. Additionally, the announcement of rooftop solarisation benefiting 1 crore households aligns with sustainable farming goals. The commitment to Direct financial assistance for 11.8 crore farmers under the PM Kisan Samman Yojana reflects a dedication to enhancing the 3Ps of agricultural business: productivity, predictability, and profitability. However, the industry was expecting more industry-centric announcements in this budget to further catalyze growth and innovation in the agricultural sector.”

Sahil Gupta, Partner, Deloitte India
“Setting up of new medical colleges will reinforce India’s objective of talent development in the healthcare space. Providing an impetus to develop research ecosystem in the country, a new corpus of 100,000 cr with 50-year interest free will be established. This will help private sector participation, including educational institutions, to do innovative research with focus on sunrise domain or sectors.”

Srividya Kannan, Founder and CEO, Avaali Solutions
The Interim Union Budget India 2024 unwraps a portfolio of measures that exude optimism for the future. The projected path to economic resurgence, coupled with a commitment to inclusive growth and innovation, sets the stage for India to continue its journey as a beacon of progress in the global arena.

Two noteworthy announcements, brimming with potential for transformative impact: the continued robust expansion of the Skill India Mission and a laudable push toward enhancing female enrollment in higher education. The former, an ambitious endeavour to upskill the youth workforce, has already begun painting a success story of empowerment and employability. Meanwhile, the latter underpins a strategic move toward inclusivity and gender parity, recognizing that the true strength of the nation lies in equipping all its citizens to contribute to the economic and social fabric with equal fervour.

The allocation of interest-free loans to stimulate innovation is not just a fiscal transaction but an investment in the unbridled ingenuity of Indian minds. By easing the financial burden on entrepreneurs and start-ups, the government fosters an environment where bold, forward-thinking ventures can flourish without the stranglehold of interest payments. This will ultimately bolster India’s reputation as a hub for innovation and drive the indigenous tech ecosystem forward. With an already burgeoning talent pool, focused investment in innovations, including in the technology sector, will likely yield significant returns, catalyzing the development and adoption of innovative solutions across industries.

Given the rising complexity of working with banks, it will be interesting to see how these are being implemented, with a focus on ease of adoption.

Rajesh Aggarwal, Managing Director, Insecticides India Ltd.
In response to the budget announcement for the fiscal year 2024-25, we, at IIL, welcome the government’s staunch commitment to the welfare and empowerment of our farmers, the providers of sustenance for the nation. The initiatives outlined in the budget, particularly those targeting the agricultural community, resonate strongly with our vision for a resilient and prosperous farming sector. The continuation of flagship schemes such as the PM Kisan Samman Yojana and PM Fasal Bima Yojana, providing direct financial assistance and crop insurance respectively, exemplifies the government’s dedication to safeguarding the livelihoods of our farmers. Moreover, the integration of mandis and the significant trading volume achieved therein highlight the government’s efforts towards modernising agricultural markets and enhancing the efficiency of agricultural trade.

This move not only benefits the farmers by providing them with wider market access but also contributes to the overall growth of the agricultural sector. The focus on empowering the youth, particularly in agriculture, is commendable as it ensures the continuity of our farming traditions while infusing new energy and innovation into the sector. We are particularly encouraged by the emphasis on technology adoption and innovation in agriculture. The integration of 1361 mandis into the Electronic National Agricultural Market, serving 1.8 crore farmers, is a commendable. Furthermore, the budget’s focus on modern storage, supply chains, and branding, encouraging private and public investment in post-harvest activities, and the widespread adoption of market linkage techniques are steps in the right direction towards building a robust agricultural ecosystem. The budget definitely reflects a positive trajectory for the agricultural sector, emphasising inclusivity, innovation, and sustainability.

We look forward to working together with the government and other stakeholders to leverage these opportunities for the benefit of our farmers and the nation as a whole.

Chirag Mehta, CIO, Quantum AMC
There was an expectation that given it’s an election year, the budget could tilt more populist with more support for the rural sector. However, contrary to expectations, the government continues to be driven by development and fiscal prudence as the central focus. Given the economic growth momentum , there was a need for assuring macroeconomic stability which has been judiciously crafted to give way for fiscal consolidation.

The lower tax collection assumption could either be conservative or a government signal to assume some growth moderation going forward. The government continues its capital expenditure on Inclusive development with Agri, Infra (including housing) and Green ecosystem as the key thrust areas with an emphasis on Research and Technological developments. There was a need to support manufacturing momentum and a way to revive the rural economy. However, probably that could be part of the main budget that gets presented in July as government plans to showcase a pathway for Developed India.

Trideep Bhattacharya, President & Chief Investment Officer- Equities, Edelweiss MF
In an election year, the budget adeptly strikes a balance, prioritizing sensibility over populism. It showcases India’s unwavering commitment to infrastructure development, coupled with a steadfast adherence to fiscal prudence. This paves the way for sustained growth, steering the nation along the trajectory towards achieving a developed economy by 2047.

Pankaj Pathak, Fund Manager- Fixed Income, Quantum AMC
This is a very good budget for the bond market as the government chose fiscal prudence over populist spending. The budgeted fiscal deficit of 5.1% of GDP is lower than even the lowest of market estimates. Faster fiscal consolidation and consequent decline in the government’s market borrowing should drive bond yields lower and bond prices higher. Another positive aspect is that the government has pegged only a moderate growth in the non-capex expenditure. This should keep inflation under check and provide enough headroom to the RBI to cut interest rates. We expect long term bonds to do well in 2024. Investors can capture this opportunity with dynamic bond funds which are invested in long term bonds.

Lalit Arora,Co-founder UBON
The recent budget announcement has invigorated the founder with a renewed sense of optimism. The decision to increase the presumptive taxation threshold from ₹2 crore to ₹3 crore is perceived as a welcome relief for small retail enterprises, offering them room for growth. The founder applauds the government’s commitment to fostering an environment conducive to development and productivity, evident in the forward-looking ‘Reform, Perform, and Transform’ approach.

The establishment of a substantial corpus with a fifty-year interest-free loan specifically tailored for the tech-savvy youth is hailed as a catalyst for innovation and entrepreneurship. This visionary move is expected to usher in a golden era of technological advancements. The founder is particularly appreciative of the strategic emphasis on strengthening defense technologies, aligning with the goal of self-reliance.

In the realm of MSMEs, the founder commends the government’s focus on providing timely finances, relevant technologies, and training, foreseeing increased competitiveness on a global scale. Overall, the founder’s positive sentiment reflects a belief in the budget’s potential to foster growth and innovation across MSMEs and retail businesses.

Manmeet Kaur, Partner, Karanjawala & Co.
The government’s plan to assist states in developing ‘Aspirational Districts’ and focus on eastern India’s development is a welcome move.

Solar energy’s expansion is going to get a boost with the announcement of a rooftop project which will provide for free electricity of 300 units per month and from solar surplus. More support to Electric Vehicles which will generate more jobs for vendors/youth in the sector of eclectic installation and maintenance including charging infrastructure.

The government has proposed a tech savvy golden era. The government plans to provide a corpus of 1 lakh crore for long tenure loans and/or interest free loans in order to promote new age tech, high quality services, opportunity expansion and innovation.

The government has proposed a tech savvy golden era. The government plans to provide a corpus of 1 lakh crore for long tenure loans and/or interest free loans in order to promote new age tech, high quality services, opportunity expansion and innovation

To improve taxpayer services and for ease of business it has been announced that Rs 25,000 tax demand up to the years 2009-2010 and Rs. 10,000 from 2010-11 to 2014-15, tax dues to be waived off by the Government. This move is going to unclog tax recovery proceedings and litigation.

Harsh Shah, Partner, Economic Laws Practice
Indirect tax rates, including import duties have been retained. In the last few days before the Budget, rate change Notifications (e.g. parts of mobile phones) have been introduced under Customs law.

Mathana Prithviraj, Co-founder and Product Head of Workhall
I would praise the bold decision to create a massive IT corpus, and I am thrilled by the forward-thinking budget. An era of opportunity for tech-savvy innovators is upon us, thanks to the young interest-free loan initiative and long-term funding. Promoting the private sector in emerging fields and bolstering deep technology in the military highlights a dedication to state-of-the-art developments.

Expanding tax advantages for new businesses and encouraging investment through tax breaks demonstrate a deep awareness of the demands of the sector. Startups, being the heartbeat of innovation, enjoy extended tax benefits, akin to a fiscal springboard. We see this budget as a catalyst, propelling startups to script a compelling narrative of success in the dynamic realm of technology. I believe that this budget supports a strong ecosystem, enabling entrepreneurs to reach unprecedented heights in the rapidly changing IT sector.

  • Published On Feb 1, 2024 at 07:30 PM IST

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