Finance Minister Arun Jaitley on February 28 presented the first full year budget by the Modi Government. Some of the top industry players have reacted to this year’s annual budget. Below are quotes from some of the top business heads:
N Chandrasekaran, CEO & MD, TCS
"The FM has delivered a bold, far sighted budget that will help raise the country's profile as an investment destination. It aims to make structural changes that will help drive higher corporate investment on a sustainable basis. These include the commitment to simplification and rationalization of the taxation structure and setting a clear roadmap of reform for the next four years. However, the short term impact arising out of increase in surcharge and service tax is matter of concern. The move to encourage use of financial products and services among a larger proportion of the population as well as the efforts towards monetization of gold are great building block to build a vibrant and deep financial services sector. The government's moves to encourage fund managers to relocate to India will also drive greater integration of the India into the global financial services economy."
"The focus on education through greater investment in institutions of higher learning as well as in skill development and the financial support for students will also help India capture its demographic dividend. Another important signal is the ongoing commitment to Digital India which will result in important opportunities for the IT sector. Extending the digital financial infrastructure through its support for greater use of payment systems like Rupay as well as the creation of a widespread broadband infrastructure will spur India's aspiration to become a ‘Smart Nation’.”
Safir Adeni President – TiE (The Indus Entrepreneurs) Hyderabad
“We have mixed reactions to the Union Budget. It is encouraging that the government has laid emphasis on job creators by promoting entrepreneurship. However, so far there were talks of Rs. 10,000 allocation for startups so we don't have a clarity whether in this budget the allocation of Rs 1000 crores under Self Employment and Talent Utilization (SETU) for the startups is in addition to the same or it is Rs 1,000 crore only now. Although the corporate taxes have gone down by 5 per cent, the increase in service tax and surcharge will have negative impact on the startup ecosystem. Due to the change in the permanent base treatment, this could be a boost in Fund Manager startup space.”
Eric Branganza, President, Haier India
"The Union Budget 15-16 is progressive in nature, with focus on physical, social and economic infrastructure, which would pave the road for future growth. We welcome the proposed corporate tax reduction, spread over next 4 years and the GST proposed to be rolled out by April 1, 2016 and nil custom duty for LED/ LCD panels. The measures taken in this budget would improve 'ease of doing business in India', especially for foreign companies. We also look forward to the benefits proposed under the 'Make in India' program.”
Sunil Khanna, President and MD, Emerson Network Power India
“We welcome the Union Budget 2015-16 as a pro-people and growth oriented budget. On the corporate front, the focus on infrastructure and the desire to make taxation regimes simpler as well as deferring GAAR by another two years, is a welcome addition. We look forward to a long-term and sustainable growth path as set by the honourable finance minister. Specifically from the perspective of Emerson Network Power, the plan for investment in infrastructure and enhanced rate of GDP growth at 8 per cent for the next two years will augur well, spurring business momentum. We are particularly excited with the emphasis laid on the renewable and solar energy space as this will bolster investment in the power generation space and will drive overall growth for the economy since energy is key to 24x7 functioning of businesses.”
Aloke Ghosh, CFO & CS, Blue Star Infotech
It is encouraging to see that the Union Budget 2015 had a special focus on PM‘s ambitious Digital India initiative. The JAM trinity of Jan Dhan, Aadhaar, Mobile & GST can prove to be game changing reforms taking forward the financial inclusion programme and smoother, seamless transfer of subsidies to the intended beneficiaries. The budget looks at not only creating new jobs, but also incentivising self employment and entrepreneurship. It will introduce more competition, innovation and bringing global expertise and technology giving a boost to the 'Make in India' programme. Its success is inextricably dependent on creation of skilled workforce. The National Skills Mission will enable skill development across several sectors and will help bridge the skill gap and make workforce sustainably employable. Also, the removal of Special Additional Duty on IT products provides relief and addresses the issue of inverted duty structure.
Anirudh Dhoot, Director, Videocon
“The 2015 budget is a balanced one, setting long term goal for better economy by keeping fiscal deficit target 3.6 per cent and implementation of GST from April 2016.
The thrust has been given on infrastructure and social security. The postponement of GAAR is a positive relief and reduction in corporate tax form 30 per cent to 25 per cent in next four years will help industry to grow. Further thrust has been given on ‘Make in India’ where the basic custom duty on imported raw material has been reduced. This will boost assembly and value added manufacturing in the country. Reduction in the basic custom duty to zero from 10 per cent on Back Light unit module used in LED panel manufacturing and Organic LED TV, also reducing duty on magnetron used in microwave oven are welcome steps.”
Somesh Chandra, Chief Operations Officer & Chief Quality Officer, Max Bupa
“The Union Budget 2015-16 is a breakthrough budget and sets pace for fast growth economic trajectory through a robust financial framework. We are delighted that the budget has fulfilled the wish list of the health insurance sector and delivered on our long-standing demand, of increasing the tax deduction limit under section 80D. Increasing the tax deduction in health insurance premium from Rs 15,000 to Rs 25000 and up to Rs 30, 000 for senior citizens will improve affordability, accessibility and awareness of health insurance.
Health benefits for senior citizens will facilitate comprehensive health coverage for the elderly and aid tax rebate. The accident insurance for rural and BPL population with annual premium of Rs 12 showcases focus on affordable healthcare provisioning. This will boost health insurance penetration, which is currently under 5 per cent and mostly restricted to the urban areas, stimulate industry growth and encourage individuals to raise their health investment. We are confident that the budget will bring macroeconomic stability by conquering inflation, enable equal economic opportunity and lay a favorable roadmap for double digit economic growth.”
Rohit Gadia, Founder & CEO, CapitalVia Global Research Ltd
“Overall it was a dream budget Corporate taxes down, GAAR postponed, crackdown on illegal money, wealth tax abolished. The major crux of the budget is that it brings an ideological shift. Ease of doing business, social security net for weaker sections Major takeaways from the unionbudget2015 were high stress on Make in India, rural development this will surly bring a surge in job creations. Health insurance premium rebate is going to help out the AAM JANTA. Tax free infrastructure bonds for projects in Railways and roads will boost up investments in Infra and railways and this will be reflected on the stocks.
Markets were up by a percent while the budget was on and later on slipped to the lows and remained volatile. It’s expected to remain volatile as the budget announced was at par with the expectations of D-street and thus market has already discounted the noise going on in the market.”
Raju Vanapala, Founder and CEO, LearnSocial.com
"This time, the Finance Minister has given special attention to the IT and ITes sector. The announcement of Rs 1000 crore for promotion of start-ups is a highly positive move. We feel that the new government has presented a progressive budget, which will help in creating an investor-friendly environment and attract more foreign and domestic investment in the IT sector. As we all know, a boom in the IT Industry with advanced technology leads to direct growth of the economy. Hence, the government has laid a special focus on this space. The new mechanism known as Self Employment and Talent Utilisation (SETU) will be a techno-financial incubation and facilitation programme to support all aspects of start-up business and other self employment activities particularly in technology-driven areas. This too will open more avenues in the sector and be a veritable shot in the arm."
Shashank ND, Founder & CEO, Practo
“Prevention is better than cure and we applaud the finance minister’s efforts to focus on preventive healthcare for our citizens by targeting 6 crore toilets under the Swacch Bharat campaign. This will have a huge impact on making our nation healthier.
We’re also happy with government’s increased focus and recognition towards the Indian Start up industry. Over the last few years, the Indian Start up industry has witnessed tremendous success in providing innovative services to the nation, along with generating substantial employment opportunities. The financial allocation of Rs 1,000 crore under the SETU - Self Employment & Talent Utilization program will drastically help boost the start-up ecosystem in India. The additional focus towards the strengthening of the IT infrastructure, the backbone of the Indian start up industry will accelerate the industry growth.
As a young company at the intersection of health and technology we’re very pleased with the government’s focus on both these sectors and look forward to working with various stakeholders to improve healthcare access for a Digital India.”
Debopam Chaudhuri, Vice President- Research & Chief Economist, ZyFin Research
“A fair budget in our view. Indian governments have always been criticized of cutting down expenditure during the recovery phase, thereby prolonging the path to growth. Mr Jaitley however, did not try to stifle public spending and acknowledged a breach in fiscal deficit targets. However he has ensured through various policies to limit leakages and spend on sectors with high multiplier effects on the economy. We need to first build an exchequer before seeking personal benefits in order to prevent future austerities.”
Dinesh Aggarwal, Jt. Managing Director, Anchor Electricals Pvt. Ltd
"Though there was no specific announcement on reducing Import duty on project imports or encouragement of energy saving products, we at Anchor believe that the overall direction of the budget was consistent with the government's commitment to strengthen the confidence in the Indian economy. The macro indicators are positive and there is a direction set to strengthen the governance of financial markets and move towards global standards, commitment towards investment directly by the government and through public participation in Infrastructure development. The reduction in tax on Royalty will encourage technology infusion and manufacturing of technology products in India. The phased reduction in corporate tax, reduction of customs duty in specific raw materials and inputs will support the "Make in India" initiative further. Clearly, the Government's intention is to empower the poor and the old in recognition of the rising health care costs and aging population. Overall, the budget has set a positive direction and it’s for the businesses to react in support now."
?LC Singh, Vice Chairman & CEO, Nihilent
“We are delighted with the Union Budget 2015 which emphasises on education, pensions, job creation, infrastructure and creating an entrepreneurial culture in the IT sector. The GST will put in place indirect tax system by next financial year while also bringing greater transparency and tax inflows. The other good news is the decision to reduce corporate tax over next four years. These are crucial moves to improve ease of doing business and we welcome them. The threshold for transfer pricing has been increased to Rs 20 crore. If this is coupled with simpler and clearer overall transfer pricing, investment will receive a boost and increase investor confidence. If the definitions of royalty are aligned with international practices, the country’s software sector will be at par with the global norms and standards.”
Suman Reddy, Managing Director, Pegasystems India
“It looks like a mixed budget from the IT Industry perspective. While there has been a significant reduction in the Corporate Tax from 30 per cent – 25 per cent and of tax on Royalty from 25 per cent to 10 per cent that will benefit the industry; on the other hand the budget did not provide any clarity on the transfer pricing issue which the industry was awaiting. Having said that, the budget has given the right direction to the economy going forward, the 150 crore corpus on making India world class IT hub will bring in a positive sentiment.
Focus on Infrastructure, Skill development and Manufacturing will enhance economic growth in the long term. Public expenditure in terms of investment in Infrastructure has also increased. It is good to see the government taking initiatives for startups, particularly the setting aside of Rs 1,000 crore to set up Self Employment and Talent Utilization SETU supporting incubation and startups. The special attention on incubators and technology led startups is welcome as these will help the industry move from a services led to products led industry. The hike in expenditure on education by setting up premier institutions in states such as J&K, AP, Punjab, Bihar Karnataka etc and strengthening the primary, secondary and higher secondary education along with the increase in specific educational scholarships for students is will further support skill development in the country.”
Ramesh Loganathan, Vice President and Managing Director Progress Software, President HYSEA
“While there was nothing dramatic in the budget, it broadly seems to be a growth inducing one. The budget provided a decent balance of Social reforms and growth initiatives including Make in India. Several small items seem like they may add up to have an impetus to make in India. The corporate tax reduction to 25 per cent from 30 per cent is straight away making more money available to the companies for investments and growth. The technical services tax reduction and reduction of duties on raw material import both should help the manufacturing sector. Streamlining the foreign investment process as well as the increased visa on arrival facility will hopefully also simplify external investments. Simultaneously, few measures seem in place to promote startups. While the details are unclear, the 150 crore world class IT hub will hopefully encourage development of new technology and products. The 1000 crore startup corpus, given the wording seems like will help setup and grow incubators and startup seeding. An interesting clause is 'mechanism for self employment to help with startups.”
Neeraj Jewalkar, Founder and CEO, Smartur.com
The Budget in totality looks positive with enhanced focus on fast-tracking growth in Healthcare, IT, Infrastructure and Education sectors. The government has linked many initiatives to support and provide a boost to Make in India. Therefore giving additional attention to startups, the government has introduced a corpus of Rs 1,000 Cr to support technology led startups and incubation centers. This will further enhance the startup ecosystem in India. Another significant move is the government’s emphasis on making the country more business and investment friendly.
Easing of regulations and focus on increased public sector investments in infrastructure will boost the business environment in the coming year. IT Industry has received a good uplift in terms of reduction in the corporate taxation from 30 per cent to 25 per cent and also reduction of taxes on royalty being reduced from 25 per cent to 10 per cent. Moreover a 150 crore corpus has been announced to make India a World Class IT hub; which should attract further investments in the sector. Strengthening of the education system through up gradation of primary, secondary and higher secondary education, enhanced funds allocation to the sector and introducing premier institutes in states like J&K, Punjab, AP, Karnataka etc will enable skill development across the country. The budget thus included a good pipeline of reforms, which will be implemented in detail and bear fruits in the coming years.
Sumit Jain, Co-Founder & CEO, CommonFloor.com
"The move of allotting INR 1000 crore to tech start-ups is only a reiteration of the Government’s intent and purpose. However, the corpus, as such, is not substantial and we can only hope that there will be a fast and efficient disbursement of this fund. Mr. Jaitley in his speech referred to the points regarding more liberal system of raising global capital and ease of doing Business, which is encouraging as it would eventually create employment opportunities in the country."