Farmers, middle class-friendly Budget to boost economic growth: India Inc
New Delhi: The interim Budget unveiled by Finance Minister Piyush Goyal on Friday will stimulate demand and boost economic growth, with a slew of sops for the middle class, farmers and workers in unorganised sector leading to more disposable income in their hands, India Inc said.
Industry leaders including Gautam Adani, Anand Mahindra, ITC Managing Director Sanjiv Puri and Walmart India CEO Krish Iyer felt issues relating to farmers, unorganised sector workers and middle class were addressed in the Budget without 'risking bankruptcy of the economy'.
"India's middle class, small traders and farmers are the lifelines of its economic growth. By catering to these ambitions #Budget2019 infuses hopes for millions of dreams," Adani Group Chairman and Founder Gautam Adani tweeted. Expressing similar views, Mahindra Group Chairman Anand Mahindra said in a tweet, "I was bracing for a populist, profligate budget driven by 'election panic.' I'm just grateful that the reliefs to the key middle class & farmer segments were delivered in a measured way without risking bankruptcy of the economy. This was a controlled, pump-priming exercise..." CII Director General Chandrajit Banerjee said the Budget for 2019-20 touched the right notes for stimulating demand and growth in the economy.
"By strongly addressing the major consuming sections of society such as farmers, the middle class and unorganised sector workers, it aims to stabilise incomes and reduce risks for vulnerable people," he added.
Walmart India President and CEO Krish Iyer also said the Budget rightly focused on the middle class, rural sector and on enhancing farmers' income. Echoing similar sentiments, ITC's Puri said, "The interim Budget proposals should augur well for the Indian economy by providing a growth impetus through a boost in consumption as well as an inclusive framework designed to benefit agri and rural communities, unorganised sector workers as well the middle class."
Dabur India CEO Sunil Duggal said the Budget 2019 can be summed up as "a series of sops" for the middle class, farmers and millions of employees in the unorganised sector. Cargill India President Simon George said there was quite a strong rural economy and agri push in the Interim Budget.
"We are particularly optimistic about the Central government sponsored PM Kisan Yojna, the Direct Benefit Transfers to small holder farmers. Though a lot more can be done but nevertheless a good move that will help farmers align better with market," he added.
Terming the budget as a forward-looking one, Sunil D'Souza, Managing Director, Whirlpool India said it is expected to increase liquidity in the hands of the consumer. "Along with the recent reduction in GST on appliances, this anticipated increase in consumer spending can be a catalyst for higher demand in our sector," he added.
Bombardier Transportation India Managing Director Sudhir Rao stated that the Budget highlights the outlaying of investment opportunities, improvement of operating ratio and introduction of new semi-high-speed trains elicits the vision to transform the rail experience for Indian commuters.
Terming it a pragmatic and progressive Budget, JK Organisation Director Harsh Pati Singhania said: "What is laudable is that higher sops and outlays were provided without additional levies on corporate and high income earners, and without any significant breach on the fiscal front".
Mr Vijay Mansukhani, MD, Mirc Electronics Ltd (Onida) said, “Overall budget is very positive for middle class, as the government has put in more disposable income in the hands of middle class of the country. This is much needed for a long time. On the other hand there is good balancing act done to agriculture sector, which would bring in much need relief to farmers of the country.
Increase in disposable income in the hands of both middle class and rural India is definitely going to spur demand for consumer durables goods like televisions, air conditioners and washing machines. This move is definitely positive for us.
Government should have worked on selective Free Trade Agreements with countries like Korea, Thailand, Vietnam and Malaysia for agricultural products rather than encouraging duty free import of consumer durables from these countries. The recent move of the Government of India to reduce customs duty on goods imported from Korea from 6.9 per cent to 6.3 per cent and from Vietnam, Thailand, Malaysia and Sri Lanka to zero is detrimental to Make in India initiative of the company. On one side the Government of India have been promoting make in India and on the other side entering FTA’s with these countries, which will not encourage the growth of manufacturing in India.”
Mr Sunu Mathews, MD, LEAP India Pvt Ltd said, “Though we all know today’s budget is an interim budget, Commendable efforts put up by Government to balance both growth and welfare of the people. Our clientele from FMCG, Beverages are going to benefit possibly from increasing disposable income in the hands of middle class of the country and rural India, this will in turn spur demand for our pallets.”
"Finance Minister has done good job by balancing welfare and growth of the country. Increase in disposable incomes in the hands of middle class and rural India is good boost for FMCG companies like us. Any saving in the taxes are generally spent on kids, which is where our focus is and this raising of income tax exemption limit and increasing standard deduction will go a long way to spur the consumption and spending power of the people", says Mr Nikhil Nanda, MD, JHS Svendgaard Laboratories Ltd.
Founder and MD Mr Tushar Jain, Founder and CEO, Highspirit Commercial Ventures, says "The two major announcements made during the budget on increasing exemption limit to Rs. 5 lakhs and increasing standard deduction from Rs. 40,000 to Rs. 50,000 are very positive for middle class, as the Government has put in more disposable income in the hands of middle class of the country. This is much needed for a long time. On the other hand paying Rs. 6,000 per annum to small farmers would bring in much need relief to farmers in the country.’
Increase in disposable income in the hands of both middle class and rural India is definitely going to spur demand for luggage products and which is very positive for us.
Ms Vidushi Daga, CEO Clone Futura & WHIZ Juniors said “This year’s budget has been one of the best budgets for middle class and the farmers in the country. Increase in disposable incomes in the hands of middle class and rural India is going to increase the affordability of the people in the country. Any increase in disposable income generally goes to Educating kids, which is very positive for us. The Government’s sincerity in balancing development and welfare of the people is commendable.”
Mr Peter Kerkar, Group CEO, Cox & Kings said, “The move by the government to increase the tax exemptions will lead to additional savings thereby leading to more discretionary spends and travel and tourism can be one of the beneficiaries The overall emphasis on improving rural connectivity with an outlay of Rs 190 billion will lead to easier access to key tourism destinations which are located in rural and semi-rural areas. Furthermore, the government’s continued emphasis on the North East by allocating additional resources to the region will dramatically improve the connectivity and give a boost to tourism."
“This year's Union Budget holds promise for the insurance sector albeit in an indirect way. The fiscal benefits to various segments of the population like the salaried middle class and rural population leaves them with more disposable funds and if rightly focused insurance sector could tap into this. Further, health care focused through Ayushman Bharat continues to be a priority for government and will take insurance to the uninsured. However the insurance sector is already riddled with frauds & abuse and as the industry penetrates the market, frauds would also increase proportionately. For an industry where costs outweigh the price controlling frauds is unavoidable. Hence, one of the key component of continued success for the industry, is investment in cutting edge data and analytics to underwrite our vast population. Using insights from existing data supported by analytics framework can prevent fraud and misuse of the policy and result in efficient utilization of funds and possibly greater penetration of insurance to cover all segments of the population in the years to come.” Shivakumar Shankar, Managing Director, India, Insurance at LexisNexis Risk Solutions added.
