UNION BUDGET 2023 – WHAT INDUSTRY GIANTS HAVE TO SAY
The Union Budget 2023 gets the thumbs up from industry leaders, with a majority of them seeing it as a positive, ‘feel good’ budget that has something for everyone. Several industry giants received the budget with a positive outlook; here’s what they have to say –
Neeru Ahuja, Partner, Deloitte India
“The Hon’ble Finance Minister has announced a common business identifier for businesses establishments as their PAN number. The PAN number will be used for all reporting and compliance to different government authorities and will also enable sharing of information amongst them.
This is one more initiative of the government to use technology and achieve the multiple goals of – efficient compliance, enforcement and to stop leakage of revenue. Businesspeople in particular will need to understand the implications and ensure that their books and records are in order – such that they do not get into issues with different authorities and end up doing multiple reconciliations.
They will need to have robust accounting and IT systems in place moving forward. On the positive side, the need to share the same information and documents with different authorities will cease and help in reducing management time.”
Rahul Jain, President and Head of Nuvama Wealth
“The changes in tax slabs under the new income tax regime which includes increase in basic exemption limit to Rs 3 lakh and a rebate limit upto Rs 7 lakh are a welcome move and a big relief for the taxpayers. This will bring about increased disposable income and savings, both through equity and fixed income segments.
A reduction in the surcharge at the highest tax bracket of 42 percent from 37 percent to 25 percent will be a big boost for investment opportunities and savings for those in the high-income bracket too. This will be a big boost for wealth creation. Nuvama Wealth clearly sees this budget as a win-win for all individual income groups.”
Shweta Shetty, Partner, Deloitte India
“PAN as a single common business identifier will simplify processes, shorten turnaround time for applications, registrations, clearances and thereby enhance customer experience and ease of doing business. The initiative is a step forward in data standardization, improving government service delivery and will help drive both, demand-side and supply-side usage and adoption of the financial infrastructure.”
Veena Sivaramakrishnan, Partner, Shardul Amarchand Mangaldas and Co.
“IFSC continues to gain importance in the present Budget. ‘Acquisition Financing’ which has always been controversial for banks under the RBI regime, will see some change in the coming days as it is proposed that foreign banks operating in IFSC can provide acquisition financing.
While RBI continues to keep Indian banks away from using its balance sheet for acquisition financing, a recognition to this, albeit from IFSC, does constitute a significant change in how RBI has generally perceived acquisition as end use. The Budget also promises a legal backing to offshore derivative contracts in IFSC.
While the letter of law will determine the extent of this change, it would certainly be of interest to see what exactly gets contemplated under the wide gamut of such contracts.”
Mr. Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions Limited (RSBL)
“The 2023 Union Budget focused on a strong & stable macroeconomic environment and is very much appreciated by Individuals, Senior citizens, Rural workers, artisans, corporates, etc. Bullion jewelers are a little disappointed, as they were expecting an import duty cut on gold in this budget. On the contrary, Silver bars and Silver dore Import duty is increased and made at par with gold and platinum.”
Anup Rau, MD & CEO, Future Generali India Insurance
“Union Budget remains in line with the Government’s growth objectives. The focus is on strengthening the foundation regarding inclusive development, reaching the last mile and financial empowerment. Some key areas insurance companies will be closely looking at going forward are the proposed investments by the Government in technology and AI, data governance policy, simplified KYC process, common business identifier and MSME sector-related initiatives.
In addition, various announcements related to infrastructure investment, including sustainable cities and green energy, will also open new avenues for the sector to mitigate and insure against potential risks. The additional income in the hands of the taxpayer owing to the expansion of the personal income tax ceiling too is likely to boost consumption. Overall, a very balanced budget.”
Monish Shah, Partner, Deloitte India :
“The finance budget 2023 was announced on the back of seven key pillars including inclusive development and last mile reach. These pillars are set to support the development of the financial sector through ease of business, reduced cost of compliance, efficient flow of credit, enhanced digital public infrastructure, and eventually foster financial stability and responsible financing.
The budget not only focuses on macro-economic development by strengthening the securities, bond, and forex markets but also focuses on retail and MSME development via credit guarantees and sustainable growth through urban infra development fund. It focuses on providing fiscal support to further the digital public infrastructure, build AI Centres of Excellence and boost acceptance of digital payments. Extension of Digi-locker to financial services as well as a risk-based KYC system is expected to accelerate data protection and promote the last-mile flow of credit and eventually help build a digi-economic profile of the user.”
Deval Sanghavi, Partner and Co-founder, Dasra
“Budget 2023-24’s focus on vulnerable communities such as the development mission dedicated to Particularly Vulnerable Tribal Groups (PVTG), scaling of Eklavya Model Residential schools and the proposed collaboration with NGOs in the literacy space is encouraging. We hope that there will be more opportunities for NGOs to collaborate in achieving the national vision for inclusive development in other areas, such as the integration of traditional artisans and craftspeople into the MSME value chain while upskilling these communities in digital and green technologies.”
Dhuwarakha Sriram, Chief of Generation Unlimited (YuWaah) and Youth Development and Partnerships at UNICEF
“We are glad that the priorities in the Union Budget 2023 feature Youth Power. The introduction of the National Digital Library for children and adolescents, provisions for teacher training, on-the-job skill training, apprenticeships, and the creation of 30 Skill India International Centres will help promote access to knowledge. The Government’s recognition of the post-pandemic learning loss is a welcome move.
Emphasis on skill development with AR/VR applications will help young people prepare for the future of work and enable them with relevant soft skills. The digital and physical infrastructure, particularly for the most marginalised young people in the hinterland, will help build higher student engagement and interest, and make learning an easy process.”
MS Sreedhar, MD & CEO, Royal Sundaram General Insurance Co. Ltd
“The government announced various investment-based programs across crucial infrastructure sectors, including urban development, logistics, technology ecosystem and green projects. At the same time, focusing on reaching the last mile, empowering fintechs, and tax incentives strengthen its inclusion agenda.
A host of initiatives around data and information repositories (National Financial Information Registry, Common Business Identifier, KYC Simplification, Central Data Processing Centre, etc.) will lead to an efficient, secured and integrated data access ecosystem.
The Insurance sector will gain from the increased economic activities and greater ease of doing business. At the same time, announcements such as vehicle replacement policy, Digital Public Infrastructure for Agriculture, a higher rebate on personal income tax and a more significant focus on public health will also substantially impact the non-life insurance sector.
Being now the most populous country in the world, India has built a robust foundation comprising of demographic dividend, economic stability, tamed inflation, improved incomes, phygital distribution network and above all, better awareness towards insurance.
The success of health insurance in the past decade – backed by strong government resolve to offer low-cost access has set the right context for the sector. We believe the industry has just scratched the surface and will ride on a high degree of customisation and product innovation in the coming years.”
Mr. Rishi Agarwal- The Managing Director of India and Head of Asia Clean Energy
“The launch of the National Hydrogen Mission kick-started the clean transition of Indian energy consumption in earnest. This budget has provided further impetus through the commitment of priority capital of Rs 35,000 crore for energy transition and battery viability gap financing. The targets though seem to be at the lower end, at 5MMT of green hydrogen by 2030 and VGF for 4000MWH. We need to be more ambitious in our goals if the aim is for India to become a leader in clean energy.”
Circular economy:
“Budget 2023 promotes a behavioral change for climate action, and a transition to circular economy. This builds on the Prime Minister’s thrust on the LiFE (lifestyle For Environment) movement. The Rs.10,000 crore investment in the GOBARdhan scheme to set up 500 new waste-to-wealth CBG plants, including 75 plants in urban areas and 300 community or cluster-based plants, and setting CBG mandates, are significant steps for sustainable growth.”
Social sector spending:
“The significantly higher outlay in capital investment is commendable. However, public spending will never be enough on its own to tackle large-scale social challenges in the country. The private sector’s resources must also be leveraged to address these challenges. Besides their innovative skills, technology, and capital resources, the private sector’s particular strength is its ability to identify needs and develop economically sustainable solutions.
The government must incentivize businesses to draw on these strengths and solve societal challenges through inclusive market-based solutions. If shared value activities that secure profits for companies while addressing societal needs, are recognized under the ambit of CSR, businesses would be encouraged to move beyond their 2% outlay on CSR for regulatory compliance, and would commit their best resources to such efforts.”
Ondrej Kubik, CEO, Home Credit India
“Union Budget has paved the way for unleashing the potential of Indian economic growth by strengthening a resilient and inclusive finance, keeping the right balance between pro-growth and fiscal prudence amidst global headwinds. The big boost is government’s growth-oriented push with continued rise in capital outlay, which will give an impetus at various structural fronts, primarily, employment generation, rising consumption, strengthening affordability, and thereby, moderating inflation.
We welcome the steps taken to enhance digital infrastructure like single KYC for individuals & businesses and digi-locker, focus on financial inclusion, ease of business & living, skilling youth, and a full thrust to green & clean economy, ensuring policy direction stability and foresighted outlook to keep the economic growth engines on accelerated path. As a consumer NBFC, we are optimistic about the road ahead and will continue to work in alignment with government’s vision and policies.”
B. Santhanam CEO Asia Pacific and India Region, Saint-Gobain and Chairman, Saint-Gobain India
“The Union Budget 2023-24 is a pro-growth budget having a strong focus on green growth that will act as a key motivator for businesses to accelerate their shift towards net-zero goals and boost sustainable growth.
There is a significant push to capital expenditure which will further attract private investment. With governments core focus on urban development, infrastructure investment, employment creation and green growth, the intentions have been clear to steer India journey towards sustainable development.
The budget has also captured important aspects such as target to reach green hydrogen production of 5MMT by 2030, implementing many programs for green growth across various economic sectors as well as create green jobs, allocation of 10000cr/year investment on urban infrastructure development and Pradhan Mantri Kaushal Vikas Yojana 4.0 that will further fuel economic growth and empower our youth.
Overall, in my view the budget will serve as the blueprint to make India self-reliant and drive long-term economic growth with ecological sustainability.”
Rohit Prasad, CEO, HelpAge India
“We welcome the tax relief that has been brought forth in Budget 2023-2024 for the salaried middle class, which will also benefit senior citizens and their households. The increase in the maximum investment limit in the scheme from Rs. 15 lakh to Rs. 30 lakh will directly benefit the middle class elder.
We were however expecting specific tax measures and enhancement of existing limits, relating to some of the provisions that were applicable for senior citizens under 80C, 80 TTB, 80D, 80DDB etc. Given that Covid posed a difficult time for senior citizens, especially in areas of health and income, we were hoping for specific measures relating to increase in the social security coverage including income & health.
Many senior citizens are in the informal sector and are out of the tax bracket and living either close to or below poverty line, for them we were especially rooting for social security measures which would have benefitted them. Many senior citizens are vulnerable and special efforts are needed to reach them we therefore appreciate the focus given to inclusive development, infrastructure creation and reaching the last mile. In context of Amrit Kaal, we hope that the govt. will take specific measures for elderly.”
Anupama Datta, Head – Policy Research & Advocacy, HelpAge India
“We appreciate that the government is mindful of including the last mile in ‘Saptrishi’ and women are recognised as a segment. One time saving schemes like the ‘Mahila Samman Bachat Patra’ have been announced which is a welcome step.
We hope that the older women also get benefits of this scheme. In agribusiness and green growth initiatives women are also included, however, it is relevant to mention, that older women play a very significant role in both, and we hope that they too get benefited. In the context of Amrit Kaal, where we are expecting the number of older women to increase exponentially, it would be good to make special efforts to include them and make them Atmanirbhar.”
Mr. Rajesh Sharma, Managing Director, Capri Global Capital Ltd
“In the backdrop of a slowing global economy, budget’s strong emphasis on capital expenditure as well as social sector spending seeks to strengthen foundations for growth continuity over medium term without ignoring short term social welfare needs. The collateral-free credit limit under the revamped credit-guarantee scheme for MSMEs should inject the right booster shot for a sector that has begun to emerge very strongly after the pandemic.
The expansion of the digital ecosystem for skilling, especially through linkages with employers including MSMEs augurs well for the growth of new businesses and employment. The direct tax proposals fulfil much anticipated expectations of the tax-paying middle class. Overall budget estimates are pragmatic and based on reasonable assumptions of nominal GDP growth. It has once again provided a good anchor to all stakeholders for the year ahead. The likelihood of outperforming the estimates seems higher. The budget has sounded a positive note for the economy to guide itself over the next 25 years on the path to becoming a developed nation.”
Deval Sanghavi, Partner and Co-Founder, Dasra
“Budget 2023-24’s focus on vulnerable communities such as the development mission dedicated to Particularly Vulnerable Tribal Groups (PVTG), scaling of Eklavya Model Residential schools and the proposed collaboration with NGOs in the literacy space is encouraging. We hope that there will be more opportunities for NGOs to collaborate in achieving the national vision for inclusive development in other areas, such as the integration of traditional artisans and craftspeople into the MSME value chain while upskilling these communities in digital and green technologies.”
Aniket Dani, Director-Research, CRISIL Market Intelligence & Analytics
“At Rs 1.1 lakh crore, the overall budgeted healthcare expenditure for fiscal 2024 may be a mere 4% higher than fiscal 2023 BE, but it is a 17% increase on the revised estimate for fiscal 2022. There is no allocation for Covid vaccination. Being a core healthcare scheme, Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana has continued to receive much-needed thrust, with an allocation of Rs 7,200 crore for fiscal 2024, indicating an increase of 12% compared with fiscal 2023 RE, further supporting insurance penetration in the country.
The overall government healthcare expenditure is estimated to have reached 2.1% of GDP in fiscal 2023 compared with 1.4% in fiscal 2019, clearly underlining the governments focus on healthcare. In addition, the announcement of 157 new nursing colleges and medical research facilities in select ICMR labs will help in bridging the deficit of skilled professionals in the healthcare sector.”
Pushan Sharma, Director-Research, CRISIL Market Intelligence & Analytics
“The agriculture and rural development budget this year veers towards structural changes and reduces focus on short-term measures. This can be seen in a 33% reduction in allocation to MNREGA and flat allocation for PM KISAN, which has led to the overall budget under these two ministries declining by 5% compared with FY23RE. Allocation for structural measures such as better planting material for horticulture crops, and cotton research, need to be monitored.
Allocation for the animal husbandry and fisheries ministry has increased by 39% and 38%, respectively. Additionally, digital public infrastructure for agriculture can improve information availability for all stakeholders in the agriculture value chain, thereby aiding access to credit, better planning for farmers and processors.”
Hiranmay Mallick, CEO & Co-Founder at Tummoc – a public transit app
“Glad to see the priority given to ‘Green Growth’ in this year’s budget. Sustainability and steps towards net zero carbon emissions are the need of the hour. With the global climate crisis, it’s time for us all as individuals, entrepreneurs, and changemakers to start playing our roles. The green credit programme planned as a part of this initiative is one that will encourage and incentivize sustainable choices in an otherwise majorly non-sustainable corporate world. Mass transition to public transport as a primary mode of commute will indeed play its role towards reducing carbon emissions.”
Monalisha Thakur, Co-founder & CMO at Tummoc – a public transit app
“The Mahila Samman Bachat Patra scheme is a great initiative for blue-collared women employees as it allows them to save more not only for themselves but for their families. The scheme can also be used to allow parents to save more for girl children thus taking a step towards securing their futures. A rate of interest of 7.5% allows them to beat inflation, thus giving them a better chance during rough economic conditions. There are also a number of other initiatives announced in the budget that are a step in the right direction. Especially the priority given to ‘Green Growth’ which will only lead to a cleaner, greener tomorrow for society as a whole.”
Monish Shah, Partner, Deloitte India
“The finance budget 2023 was announced on the back of seven key pillars including inclusive development and last mile reach. These pillars are set to support the development of the financial sector through ease of business, reduced cost of compliance, efficient flow of credit, enhanced digital public infrastructure, and eventually foster financial stability and responsible financing.
The budget not only focuses on macro-economic development by strengthening the securities, bond, and forex markets but also focuses on retail and MSME development via credit guarantees and sustainable growth through urban infra development fund.
It focuses on providing fiscal support to further the digital public infrastructure, build AI Centres of Excellence and boost acceptance of digital payments. Extension of Digi-locker to financial services as well as a risk-based KYC system is expected to accelerate data protection and promote the last-mile flow of credit and eventually help build a digi-economic profile of the user.”
Shilpa Mankar Ahluwalia, Partner, Head – Fintech, Shardul Amarchand Mangaldas & Co.
“The move to make PAN a universal identifier for all digital systems at government agencies, if utilized effectively, can be a game changer for digital services. For businesses, it can achieve what Aadhaar has done for individuals. PAN as the common identifier has the potential to simplify KYC processes, streamline access to public goods (including licenses and registrations) and make it easier to do business. It can also act as the single data point not just for regulators but also for distribution of private goods such as financial services.
With adequate safeguards around data security and privacy, data linked to PAN could potentially be analysed to determine eligibility for credit, investment, insurance and other financial products, improving, for example, credit access for SME and MSME businesses. This move will also facilitate the building of a centralized KYC database that could significantly lower KYC costs for banks and other financial institutions when onboarding smaller businesses.”
Suchintan Chatterjee, Partner, Deloitte India
“The Hon. Finance Minister’s announcement to support the Indian MSMEs by expansion of the ECLGS by an additional INR 50,000 crore till March 2023 is a welcome move. This progressive step specifically helps the Travel , hospitality and allied sectors , given they were hardest hit by the pandemic. While the infusion of INR 9,000 crore into CGTMSE is intended to bring down credit cost by about 1%, the planned revamp of the scheme will help extend the corpus beyond traditional term loans.
Put together, these can drive significant credit transmission for the Micro and Small end of the spectrum where the credit gap is most significant. Earlier there have been several digital initiatives targeting MSMEs in the recent past, however the interlinking of various digital portals like UDYAM, e-Shram, NCS and ASEEM sets the right tone and will drive awareness and adoption especially for new-to-digital units. When seen in conjunction, interventions like these will go a long way to address the MSME credit gap that is estimated to be upwards of INR 28 trillion.”
Mr. Prabhat Chaturvedi, CEO, Netafim Agricultural Financing Agency Pvt. Ltd. (NAFA)
“Today’s union budget announcement is a testimony to policymaker’s intent of touching every aspect of the economy. Formation of National Financial Information Registry to serve as a central repository of financial and ancillary information is an excellent decision. It is a smart step and will aid in solving the problem of lending, foster financial stability and encourage financial inclusion in the country by aggregated data.
It will support smaller NBFCS to bring cost-effective credit underwritings, particularly focused on MSMEs. It will also help to conclude End-to-end digital processing efficiently with standard checks and balances within prompt turnaround time. The Vivad Se Vishwas initiative will boost the confidence of entities dealing with MSMEs as it covers the performance risk. The announced measure will have a butterfly effect on the credit sector as well as will provide cushion to create an engine of growth.”
Shaina Ganapathy, Head of Community Outreach, Embassy Group
“We, at Embassy, are happy to see the fields of education and healthcare, the cornerstones of our outreach, significantly addressed in the Union Budget 2023. After nearly three years of disruptions caused by the COVID-19 pandemic, the education budget crossed Rs. 1 lakh crores last year. With the shift towards digital learning, an expansion of digital infrastructure that is inclusive in nature is much needed in the upcoming year.
Therefore, it’s great to hear our Honorable Finance Minister share that a National Digital Library for children and adolescents will be set up, which makes available books across geographies, languages, learning-levels, and more. States will also be encouraged to set up physical libraries and provide technology to access the National Digital Library Resources.
Additionally, to bridge pandemic-induced learning gaps, as well as build a culture of reading, the National Book Trust, the Children’s Book Trust, and other sources will be encouraged to provide noncurricular titles in regional languages and English to these physical libraries. Considering the drastic shortage of teachers in government and rural tribal schools across the nation, we are pleased to note that in the next 3 years, the Centre will recruit 38,800 teachers and support staff for the 740 Ekalavya schools serving 3.5 lakh tribal students.
EMRS has had their budget increase by a significant Rs. 581.96 crore to Rs. 2,000 crores for the 2022–23 financial year. Supporting residential schools run for tribal students, this scheme will go a long way towards enabling a holistic tribal education system in the country.
Teachers will be vital towards recognising tribal cultures, languages, curriculums and unleashing their inherent learning ability. Teacher training will also gain further prominence across the country and be reimagined through integrated curriculum transactions, continuous professional development, dipstick service, and ICT implementation.”
Dr. Renisha Chainani, Head-Research, Augmont – Gold for All.
“The 2023 Union Budget is quite a cheerful budget for Individual taxpayers, where the focus was on the rural economy and increasing CAPEX allocation for adhering to the fiscal consolidation path. There have been some duty changes for the bullion industry, where Silver Bars and Silver Dore Import Duty are increased to 15% and 14.35%, respectively, and are aligned with gold and platinum. Moreover, the conversion of physical gold into EGR and vice-versa has been exempted from Capital Gains – this will enable EGRs to become more popular.”
Swapan Mehra, CEO and Founder IORA Ecological Solutions
“The new budget’s tremendous focus on green growth addresses critical areas of climate and conservation action. The green credit scheme is a pioneering instrument to reward environmentally sustainable and responsive actions by corporates, individuals, and local bodies.
It values multiple ecological attributes and goes way beyond carbon to incentivise tangible action. The commitment to setting up 10,000 bio-input resource centres and harnessing the value of waste and converting it into biogas tackles methane emissions very effectively.
PM PRANAM’s emphasis on bio-fertilizers and enable balanced application of chemical fertilizer addresses is an important intervention not only for soil health, but for farmer incomes, health and the health of larger ecosystems. Mangroves, highly threatened ecosystems, are critical for coastal resilience of communities, biodiversity, and ecosystems in addition to being major sinks of carbon.
It is heartening to note the announcement of the “Mangrove Initiative for Shoreline Habitats & Tangible Incomes” to provide special focus on their conservation and restoration. Our inventorying and analysis efforts on wetlands- from the high-altitudes of Sikkim, Manipur to central Indian states of Madhya Pradesh, have always revealed immense contribution of these important ecosystems to local economies, biodiversity, and culture.
Amrit Dharohars announcement to value and invest in realizing the multi-use values of wetlands will go a long way in achieving their true potential to contribute to India’s green growth. All these commitments are a major boost to our work on climate action and natural resource conservation in the country.”
