Industry Speaks: Mixed reactions to the Budget 2017-18 from various sectors!

Industry experts from various industries gave a mixed reaction to the Union Budget. Generally termed as  a well-balanced budget, the industry experts have welcomed the budget and at the same time have mentioned what more could be done to boost their respective sectors. Let’s have a look at the same:

Dr. P. M. Bhujang, President, Association of Hospitals says, “Healthcare is one of the major sectors which requires additional focus in India as public health spending in India is one of the lowest in the world, an ironic reality is that public health systems are unable to utilize the meagre budgets allocated to them. Few points highlighted in the Union Budget 2017 for the healthcare sector like eradication of major disease like Tuberculosis, Measles, Kala Azar, and Filariasis is a major necessity. Also the provision of 1.5 lakhs health centres and health sub-centres to be created to improvise the quality service will surely help in the betterment of the healthcare sector if implemented and funded properly. Apart from the budget being helpful for the rural development; few concerns which should have had more focus were the infrastructure required in hospitals. If you check the statistics, there are hardly beds available for the number of patients in the hospitals. The number of nurses and doctors are also very less in private as well as government hospitals. The decision in opening new AIIMS in Jharkhand and Gujarat is a good step, but only restricting to these two cannot match the number of doctors and nurses required in India.”

Rahul Narvekar, Co-Founder, Scale Ventures says, “As an investor, I feel that the exemption is a welcome change. Start-ups are always striving hard to break even beat profit and the exemption provided will surely help the young entrepreneurs to allocate funds accurately. Start-ups which are boot strapped are relieved and feel encouraged that the government is propelling them to make India a hub of successful start-up industry.”

Anirudh Dhoot, Director, Videocon says, “The 2017-18 financial budget based on the objective to Transform, Energise and Clean India, is aimed at spurring economic growth, synergizing investments and establishing greater transparency. With 100% rural electrification, lowered tax rates for MSMEs, and increased allocation towards schemes like M-SIPS and Electronic Development Fund (EDF), the budget fosters positive steps to further accelerate manufacturing capabilities and boost employment in the country. High disposable income as a result of lower tax rates will lead to higher purchasing power of the individuals. This will lead to increase in demand for consumer goods. Also, we are happy to learn that GST is on track and will be implemented in April 2017. In addition to this, the Abolishing of Foreign Investment Promotion Board to ease the inflow of Foreign Direct Investment (FDI) will expand investments significantly.  All this will play an extremely important role in the realization of the Government’s dream of ‘Make in India’.”

Munish Sharda, MD & CEO, Future Generali India Life Insurance says, “The Union Budget has done a fine balancing act of boosting growth by spending more on rural areas, infrastructure and fiscal prudence. A higher infrastructure spend was much needed to kick start the investment cycle to provide fillip to growth. With the impact of demonetization being the highest in cash based rural economy, the Union Budget has rightfully taken a lot of initiatives to reinvigorate the rural sector. The other theme of the Budget was curbing the tax evasion with a thrust on promoting digital transactions and widening the tax base by giving sops to tax payers in the lower income bracket. Overall, the Budget is a very structured one and is carefully crafted to boost people’s spending power, create jobs and improve rural income.”

Jyoti Vaswani, Chief Investment Officer, Future Generali India Life Insurance says, “The Budget is pragmatic and attempts to achieve a fine balance between growth and fiscal prudence. It has tried to alleviate the negative impact of Demonetisation on consumption and growth by giving a significant boost to infrastructure and rural growth. The rationalisation of income tax will provide a consumption fillip and will bring more people in the tax net.  No change in the capital gains tax for equity has been taken very positively by the market. Curb on cash transactions above 3 lacs, transparency on political funding and focus on increasing tax net are further steps to curb black money in the economy. Adherence to fiscal prudence and roadmap for bringing down the general govt. debt to 60% is commendable and should be well received by the markets and credit rating agencies.”

M Ravichandran, President, Tata AIG General Insurance Company says, “The Union Budget 2017 announced earlier today focussed largely on three themes – agriculture, digital revolution and emphasis on eliminating corruption and black money, while also giving a huge impetus to small and medium businesses.  With a view to boost the agricultural sector, the government has increased the coverage under the Pradhan Mantri Fasal Bima Yojana from 30% to 40% in 2017-18 and 50% in 2018-19 which will help farmers get insured. Farmers will also benefit further with the government spending Rs 13,240 Cr in FY 18 on crop insurance. Also, with the government emphasizing further on digital India and cyber security, this will help strengthen a transparent financial ecosystem. The disposable income for individuals earning between Rs. 2.5 – 5 lakh will increase due to the reduction in tax to 5% from the current 10%. This will in turn encourage the lower and middle income strata of people to invest in instruments such as insurance, mutual funds, fixed deposits etc.”

Saswata Das, Partner & Executive Director, WOW Design says, “As I was expecting, the budget has focused on the rural end, fighting poverty and increasing spending on infrastructure.
The new tax bracket of 5% is a welcome relief to the middle class, however, I have my doubts on whether it will actually result in more people paying taxes. The cutting of corporate tax rate to 25% for smaller companies is also a good move towards encouraging SMEs and overall entrepreneurship. But here I believe this will encourage higher compliance as the tax leakage is usually higher in the lower end of the corporate pyramid.”

Sanjay Kumar, CIO, PNB MetLife Insurance says, “The Union Budget 2017 is a prudent mix of economic growth and fiscal consolidation. The government has budgeted fiscal deficit at 3.2% for FY18, broadly in line with market expectation. This has been accompanied with strong focus on rural and agricultural sectors as well as low cost housing. The grant of infrastructure status to low cost housing is likely to improve access to credit for the sector. The government remains committed to sustained spending in infrastructure sector amid weak private investment, particularly in railways, roads, airports and irrigation. As expected, promoting cashless transactions continues to be a focus area. Further, the government has provided much-needed comfort to small and medium enterprises with turnover up to Rs 50 crores by reducing the income tax rate from 30% to 25%. Wealth redistribution has been a priority as seen from the reduction in the personal income tax rate from 10% to 5% for people earning up to Rs 5 lakh and application of 10% surcharge on people earning between Rs 50 lakh and Rs 1 crore. Overall, we see this as a balanced budget in the current macro-economic scenario and is likely to be well received by the market.”

Marzin Shroff, CEO, Eureka Forbes says, “We appreciate the efforts of the government aimed at solving the drinking water problems of India. Eureka Forbes is the market leader in water purification and we would be happy to extend our support towards these efforts by leveraging our technology know how and available solutions. We welcome this move.”

Deepti Kshirsagar​, Partner & Executive Director, WOW design says, "The Budget 2017 promises further boost to the digital economy and hence more marketing spends on digital media. Also the move for demonetisation which made the marketeers to pull the plug on add spends almost by 25 percent are hopeful as the budget aims to quicken Remonetisation. 5% tax exemption for smaller companies with turnover below 50 Crores will boost more startups to pump in that chunk into marketing spends."

Yash Jaiswal, Rainforest says, “Focus on Infrastructure likely to boost tourism. The assertion by FM that the pace of Remonetization has picked up good news for the cordial reception industry as the demand should get back to pre-8th November, 2016 level. I was expecting a concrete step to boost tourism and include this in overall infrastructure, but the more pressing issue for  FM have dominated the budget and this particular segment shows to have escaped the attention of FM. If I take a quote from FM, Service charges withdrawn through IRCTC would be considered a message to Hospitality industry and the government policy in time to skew along that line. I hope the FM initiative on Infrastructure would result that would help to boost tourism and hospitality.”

Tamaal Roy, CEO, Biomatiques Identification Solutions says, “The Union Budget 2017 is a significant move to push digital payments. The biggest highlight from the technology perspective is the exemption of components from taxes to encourage domestic manufacturing of these devices by providing exemptions like BCD (basic custom duties), excise duties, CVD (countervailing duties), SAD (special additional duty) on miniaturised card readers and mPOS micro atms, finger print readers, scanners and iris scanners.  The 2017 Budget has opened the doors that will allow people to avail long term benefits of digitalisation and make digital transactions more safe and secure. Incentivising Iris based authentication can go   a long way in embracing the digital way of life. Schemes such as Aadhaar Pay for people who don’t have mobile phones, cash back scheme for merchants, Aadhaar-based smart cards with health details for senior citizen, etc. will re-emphasise the government’s approach towards making India a more cashless economy.”

 Vinay Gupta, Shri Hari Diagems says, “More access to money equivalent to luxurious life. I feel it is a great step taken from government.”

Saurabh Maheshwari, Vishal Jewels says, ‘’I think the Union Budget is good news for the jewellery sector as the entire focus is on digitalisation and this will give a boost to the sector and drive consumption. And with passage of time, this will normalise things and help the trade due to increased consumption.’’