Neil Banerjee
As the nation eagerly awaits the unveiling of the Interim Budget 2024, there is a palpable sense of anticipation and expectation in various sectors, as the government’s fiscal policies and budgetary allocations play a pivotal role in shaping the economic landscape.
The government aims to control spending and ensure ongoing growth by limiting the overall spending increase to about 10% in the FY25 interim budget. A balance between sustained growth and fiscal consolidation, which includes slowing down the rise in capital expenditure and moderately increasing revenue spending, will be prioritised. Additionally, the government has set a fiscal deficit target of 4.5% of GDP for FY26, expecting to meet this target in the current year itself.
Fuelling digital transformation
“We expect the Interim Budget 2024 to emphasise on AI integration in sectors like healthcare and agriculture, with increased AI research funding and digital infrastructure enhancement, including high-speed internet and smart city development,” says Akshat Saxena, CEO, Froker.
“I believe the Interim Budget 2024’s focus on MSMEs and fintech will prove to be transformative for our industry. Initiatives like enhanced lending solutions, the India Fintech Credit Fund, and streamlined credit platforms will provide crucial support for business growth,” he adds.
In a world increasingly driven by technology, the budget is expected to fuel digital transformation. The spotlight on artificial intelligence, blockchain, and cybersecurity is anticipated to be more pronounced, particularly in sectors like healthcare and agriculture. The budget may outline measures to enhance digital infrastructure, ensuring high-speed internet access, and fostering smart city development.
Pawan Kumar, CEO of Elista, states, “In the Interim Budget 2024, we foresee an expansion of Production Linked Incentives (PLI) schemes to promote electronic component manufacturing.”
This suggests a holistic approach, aiming not just at digital transformation but also at fortifying the manufacturing sector.
Infrastructure development: The backbone of progress
The anticipation for a continued emphasis on infrastructure development is evident. Expectations include incentives for research and development, addressing industry-specific challenges, and encouraging growth in new segments and geographies.
“As we approach the announcement of the Fiscal Budget 2024-25, we expect that the government will further prioritise infrastructure development and promote measures that boost regional manufacturing under the ‘Make in India’ theme,” says Jayant Jain, CEO, GM Modular.
With a focus on regional manufacturing and technological innovation, the budget may introduce measures to stimulate the electrical industry.
“Our expectations from the forthcoming budget 2024-25 revolve around creating advancement in the technological landscape and stimulating innovation in the electrical industry,” Jain adds.
The market’s emphasis on innovation reflects the industry’s hunger for technological advancements. The budget might address this by allocating funds for R&D, providing tax incentives for innovation, and fostering collaborations between industry and research institutions.
Global competitiveness and tax policies
In the pursuit of global competitiveness, Indian companies are navigating the intricate intersection of fiscal strategies and technological investments. The reduction of corporate tax rates and a focus on innovation emerge as linchpins for propelling these businesses onto the international stage.
“With Indian companies seeking to gain a competitive advantage in the international market, the reduction of the current corporate tax rate is a key enabler for realising significant gains,” says Piyush Goel, Founder and CEO, Beyond Key.
“To propel Indian businesses to the leading edge of technological advancements, prioritising investments in artificial intelligence, innovation, and research and development is crucial,” he adds.
The global stage is set, and India aims to be a frontrunner in international markets. Corporate tax reduction is seen as a vital step in this direction. The budget may further prioritise investments in innovation and research and development, providing the impetus for Indian businesses to excel globally.
Abhinav Saxena, Founder of Saxenas And Kumar Law Chambers LLP, underlines the need for changes in tax policies, stating, “We are looking for a positive change for the Indian public at large from this interim budget.” This indicates a broader expectation for tax policies that benefit the common citizen, fostering economic growth from the bottom.
Revitalising higher education and healthcare
“A 10 per cent increase in funding is what we are hoping to see for higher education, particularly for private universities,” says Dr Sibaram Khara, Vice Chancellor, Sharda University.
“One of the main things we need is support to position India as a centre for the internationalisation of education,” he adds.
Khara further outlines the critical role of education in India’s global standing. The expectation of a 10 per cent increase in funding for higher education institutions aligns with the broader vision of boosting innovation and research.
Higher education holds the key to a skilled and knowledgeable workforce. Expectations include increased funding for private universities, support for research and innovation projects, and initiatives to establish overseas campuses. The budget might outline strategies to position India as a global hub for education and encourage international collaborations.
Talking about India’s healthcare system, Dr. Narendra Vankar, Founder and CEO, Quantum CorpHealth, says, “This is India’s second post-pandemic budget, and unfortunately, last year’s budget for the healthcare sector was lacking. This year, it is imperative to focus on bettering India’s health infrastructure like building more hospitals with an increased number of medical professionals for our growing population.”
“Collaborations between the private and public sectors can enhance telehealth in India. The success of digital adoption in banking and education suggests a similar trajectory for healthcare. Despite past scepticism, recent advancements enable higher healthcare budgets, improving the accessibility and quality of medical practice in India,” he adds.
Promoting ‘Make in India’ and tax incentives
‘Make in India’ has been a cornerstone of India’s economic strategy, and the budget is expected to reinforce this initiative. The government may introduce measures to boost domestic production through incentives, tax rebates, and streamlined regulatory processes.
“The ‘Made in India’ initiative seems to have strong support from the Interim Budget 2024. The government is likely to provide incentives including tax rebates, subsidies, and expedited regulatory procedures with the goal of boosting domestic production,” says Rajesh Shah, MD, Euro Panel Products Limited.
“We, as a pan India law firm, are suggesting some changes in and hoping for some proposals from the upcoming interim budget from the ministry of finance like raising the basic exemption limit, and a hike in deductions for health insurance premium payments as medical costs are rising,” says Saxena.
Shah sheds light on the strong support for the ‘Make in India’ initiative. The budget’s potential to provide tax incentives and subsidies could be a game-changer for domestic manufacturers, potentially reshaping India’s economic landscape.
What’s the winning recipe?
As we stand on the brink of the unveiling of the Interim Budget 2024, the expectations are diverse but centred around common themes – technological advancement, infrastructure development, global competitiveness, higher education and healthcare revitalisation, and the promotion of ‘Make in India’. Since the budget is not merely a piece of paper but the roadmap for a nation’s progress, the government’s approach to these focus points will play a crucial role in steering India towards sustained economic growth and resilience in an ever-evolving global landscape.
