Anushruti Singh
The upcoming Union Budget for 2024-25, set for July 23rd, is drawing keen attention from all corners of India’s economy. Industries spanning infrastructure, IT, telecom, agriculture, healthcare, human resources, and education are on high alert, anticipating how the government’s fiscal strategy will shape their futures. This piece examines the central hopes and forecasts of industry leaders across various sectors for Budget 2024-25, drawing insights from pre-budget discussions, industry reports, and expert evaluations.
Infrastructure improvement and product cost for MSMEs
Over the last years, great focus has been given by the ministry and government on expanding the adoption of clean technologies and also supporting the growth of startups as well as MSMEs. But, none of this will bear fruits, unless the government takes drastic steps to improve infrastructure and lower production costs for MSMEs, said Samit Jain, Managing Director, PLUSS Advanced Technologies.
“Power infrastructure has to be upgraded in all industrial areas. Further simplification of labour laws is necessary and reducing the compliance costs. Clearances for pollution control need to be streamlined and made simpler for organisations to adhere to,” said Jain.
“To further R&D, direct funding or grants to industry is necessary, rather than through universities. Industry needs to be able to control and drive new investments in research. Energy circularity needs to be promoted by giving incentives to industry and commercial infrastructure that are able to significantly demonstrate reuse of energy. Just like being done for reuse of water. This will grow major segments like thermal energy storage, that is gaining prevalence in Europe but not yet in India.” he added.
Expand reach for CGTMSE
The most significant difficulty for MSMEs is financial. The industry continues to believe that closing the credit gap is crucial in the 2024-25 budget.
“Expanding the reach of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) and promoting innovative lending models are crucial to bridging the credit gap that MSMEs face. Simplifying compliance procedures and reducing regulatory complexities will unleash the true potential of these enterprises,” said Amit Bansal, CEO, Solv.
Policies to support electronics manufacturing
The Indian electronics manufacturing sector is ready for significant growth. In the upcoming Union Budget, electronics manufacturing stakeholders hope for policies that will support an export-driven strategy, especially in television exports.
“To achieve this, a focus on boosting domestic production and empowering Indian manufacturers is essential. Streamlining supply chains and prioritising the localisation of components can reduce our dependence on overseas suppliers and strengthen our economy by building a strong local manufacturing ecosystem, creating jobs, and increasing foreign reserves,” said Sharan Maini, Director of Veira Group.
“By creating a supportive environment that encourages innovation and simplifies business operations, we can enhance India’s position in global electronics manufacturing. Implementing these measures can help India become a key player in electronics manufacturing, serving both domestic and international markets,” he added.
Boost to domestic phone making
India inc is looking forward to the upcoming Union Budget 2024-25 with a focus on initiatives that propel domestic manufacturing and foster a thriving Indian mobile phone ecosystem.
Ravi Kunwar, Vice President- India & APAC, HMD commenting said, “We particularly look forward to extending or improving the Production Linked Incentive (PLI) scheme. This policy has been instrumental in propelling domestic manufacturing, and its continuation will be crucial for building a robust indigenous component supply chain. We also wish that the government prioritises the policies that incentivise the production of key smartphone components within India, fostering a self-reliant ecosystem,”
More initiatives for skill development
With close to 25% of the global workforce coming from India over the next decade, skill development and empowerment should be a strategic imperative.
Manoj Nair, Head of Global Delivery Centres, Fujitsu said, “A skilled workforce is crucial for economic development. As technology rapidly advances, we need to prepare young people with a mix of education and skills to help meet the future needs of our economy. Now is the time to bolster digital literacy by establishing dedicated centres of excellence,”
R&D emphasis on AI
Looking ahead to Budget 2024, another area that calls for a greater emphasis is research and development (R&D) initiatives to enhance our competitiveness especially in AI, Nair pointed out.
“I remain optimistic that the government will introduce more ground-breaking and transformative initiatives, thus elevating AI use cases and intellectual property creation. By accelerating AI innovation, we can enhance the country’s technology development ecosystem and provide a major boost to sectors including healthcare and automotive among others,” he said.
In addition to AI, government should also elevate the country’s technology development ecosystem by strengthening the semiconductor space, which can provide a greater boost to sectors including healthcare and consumer electronics among others, he added.
Continued support to agri sector
The Interim Budget of 2024 allocated ₹1.17 lakh crores to the Ministry of Agriculture, marking a ₹1997 crore increase from the previous budget. The upcoming budget is anticipated to maintain continuity in key measures outlined earlier. Focus areas include enhancing farmers’ income, reducing food waste, managing price pressures, and fostering growth in micro and small food processors.
Shashank Singh, CEO & Co-Founder, Poshn commented, “Initiatives such as PM Kisan Nidhi Yojana and PM Fasal Bima Yojana, aimed at providing minimum income support and crop insurance respectively, are expected to continue. These measures are poised to bolster the agricultural and food processing sectors, driving efficient growth and sustainability,”
Enhancing Agri Exports India, despite contributing 8.5% to global agricultural production, holds just a 2% share in the global agri-export market. “This disparity necessitates targeted government interventions. Focus on key commodities like rice, wheat, and pulses is crucial to boost export competitiveness through improvements in crop quality, supply chain efficiency, and production enhancements,”
Climate-Resilient Agricultural Practices India’s agricultural sector has faced significant challenges due to erratic climatic patterns, impacting both kharif and rabi harvests in the recent past. Two such examples could be the early onset of southwest monsoon last year and El nino this year. Enhancing climate resilience is critical for mitigating these risks and ensuring sustainable growth in the sector, he added.
Reclassify hotels as infrastructure
The hotel industry believes that reclassifying hotels as infrastructure and granting tax breaks for sustainable practices will greatly increase investment appeal.
Talking about the expectations from the budget, Saurabh Gahoi, Senior Vice president at Ramee group of hotels said, “Reduced GST for the tourism sector and streamlined single-window clearances will make travel more affordable and business operations smoother. By supporting spiritual and business tourism, especially in tier 2 and tier 3 cities, we can unlock immense potential for economic growth and job creation. The right government policies can drive the hospitality sector to new heights, making India a global leader in tourism,”
Standardised tax for alcobev sector
Rising disposable income is fuelling a fascinating shift in the alcoholic beverage sector. Players in the sector are witnessing a surge in demand for premium and craft products, particularly among younger consumers. With this the alcobev sector wants a more standardised tax structure across states, coupled with investments in responsible consumption initiatives, could unlock the sector’s full potential.
“Additionally, we are keen to see policies that enhance the overall competitiveness of the Indian alcoholic beverages market. The craft beer segment, in particular, presents a promising growth opportunity. We believe that targeted support, such as streamlined licensing processes or other pro-innovation measures, would greatly encourage entrepreneurship and creativity in this sector.” Tushar Bhandari, Whole Time Director, Associated Alcohols and Breweries Ltd highlighted.
