With the Budget 2015 announcement more positively focusing around the corporate side – rather than the common man, a number of IT and telecom focused organization are applauding the Indian budget 2015. We are presenting some of the prominent reactions coming in from various corners of the industry.
Alok Ohrie, President and Managing Director, Dell India
“We’re glad to see a positive budget announced by the Hon’ble Finance Minister. This reaffirms the reform stand taken up by the government and its commitment to investors here. Some of the forward looking statements made by the Finance Minister have a bearing on our sector – exemption of SAD, reduction of Basic Customs Duty on electronics components, inputs etc., ease of doing business, encouraging startups and the big boost to healthcare. However, we’ll need to review the notifications before any predictions could be made on the impact on the sector. The economic survey has indicated that a clear political mandate for big bang reforms coupled with a benign external environment can propel India to a double digit growth trajectory. Today’s announcement only goes to support this. Dell has been a major contributor to the IT sector in India. Apart from being India’s most trusted technology brand, Dell’s manufacturing facility for electronics has been shouldering the ‘Make in India’ mantle for more than 7 years. In addition, we’ve been eagerly awaiting these announcements that boost the manufacturing capabilities of the country that will eventually grow the sector”.
Amar Babu, President, MAIT
“Budget 2015 is a balanced budget that touches upon many areas of infrastructure, universal social security vision, insurance for all, education among others. From an IT industry perspective, it is a mixed bag with the inverted duty structure being finally addressed with the removal of SAD on all components. The removal of customs duty on components and concessional structure of 2% without CENVAT credit are positive steps to encourage tablet manufacturing in India. However it disappoints as no initiatives have been taken to increase PC manufacturing and promote exports. In this budget, we might have missed an opportunity to drive ‘Make in India’ in computers.”
Khwaja Saifuddin, Senior Sales Director – South Asia, Middle East and Africa, WD
“The budget carries forward the government’s vision of Digital India and Make in India, and had some encouraging announcements especially regarding the development of infrastructure, employment generation and training of the youth. The support that is likely to be meted out to start-ups and SME’s through MUDRA Bank is expected to help the existing 5.77 crore small business units in the country expand their operations besides assisting new start-ups. The proposed reduction in the rate of income tax on royalty and fees for technical services from 25% to 10% will empower small businesses and start-ups digitally and make them important contributors to the Digital India initiative. Similarly, steps taken to enhance the employability of the youth through National Skills Mission and Deen Dayal Upadhyay Gramin Kaushal Yojana will result in the industry having an educated and trained workforce, a must for the Make in India initiative to progress. As the Financial Minister mentioned, this would turn ‘job seekers’ into ‘job creators’. Besides this, the proposal to reduce the basic rate of Corporate Tax from 30% to 25% over the next four years is a welcome move. Not only will this make the business environment in the country more lucrative, it will also lead to higher investments, job creation and growth.”
S.Rajendran, CMO, Acer India
“We’re happy and welcome this positive budget which has defined a clear roadmap on many aspects addressing the need for stability in policy framework. Some of the bold announcements made by the Finance Minister and have a direct bearing on our sector – infrastructure spending, direct transfer to beneficiaries, committed date of April 01, 2016 for Goods & Service Tax (GST) and enhanced social security thrust will convey a reassuring message to potential overseas investors. However, we’ll need to review the provisions before any predictions could be made on the impact they will have on the sector. IT industry expected more from the budget. While some progress has been made towards addressing the inverted duty structure and dual Central Value Added Tax (CENVAT) structure for encouraging local assembly/manufacture of tablets and smartphones, keeping out PCs with the attendant increase in Excise duty/CENVAT from 12.36% to 12.5% in addition to the jump to 14% in service tax bodes ill for increasing demand for this category which is already suffering from woefully low penetration rates. We are eagerly hoping that with the clear direction spelt out, there would be more reform oriented policies and measures as the year progresses so the momentum for an accelerated GDP growth continues.”
Anil Valluri, President, NetApp India & SAARC
“The budget by the Finance Minister, Mr. Arun Jaitley is a bold and an assertive one. We are pleased to know that local businesses and budding entrepreneurs stand to make a mark globally through various schemes that will help them prosper. A number of steps have been announced to improve the ease of doing business; creation of Micro Units Development Refinance Agency (MUDRA) Bank, with a corpus of Rs. 20,000 crore, and credit guarantee corpus of Rs. 3,000 crore is a positive step to encourage young, educated, skilled workers who aspire to become first generation entrepreneurs or expand their activities. With robust growth in the Digital India initiative announced last year, it is heartening to see that the Government wants to further expand it and increase the network connectivity to more rural areas. A progressive and investment focused budget overall from which we hope to see tremendous growth for the Indian economy.”
Partha Iyengar, Country Manager (Research) – India, Gartner
Overall, the budget is a ‘feel good’ budget. It has a pragmatic and good balance of social programs, industry (large and SME) friendly programs and tax reforms, without going overboard to be populist or ‘politics driven’.
In terms of the IT industry specifically there is a nod for the needs of the IT industry in terms of making a statement that the needs of the IT industry will be addressed in terms of ease of doing business, capital access etc. However, without reviewing the details of exactly how this is to be done, we will need to adopt a wait and watch approach to see how effective it will be.
Reducing the tax on R&D and innovation investments to 10% is a very positive move, both from the point of view of facilitating technology transfer as well as incenting companies to invest more in driving innovation. Along the same lines, the nod to the ‘start-up ecosystem’ in the country is a major positive. This is the first time such language has made its way into the budget and a good reflection of the fact that job growth has to be broad based by facilitating the SME segment and even the start-up culture in the country.
The increase in infrastructure investments across the board is another positive measure. Here however, the devil, as always is not in the budget pronouncements but the actual implementation of those announcements, which is where the challenges have always been. The fact that there wasn’t a strong acknowledgment of that fact and plans to ensure implementation oversight of these massive programs remains a concern. As an example the NOFNP program has been dragging on for many years now, and other than reaffirming the desire to accelerate implementation, the fact that a hard (new) deadline was not established and committed to is a concern.
On education and skills development again, there are some strong announcements like creating a skills development fund, an innovation platform, and basic education availability within 5 kms of every village. BUT, where are the teachers going to come from? So I would have expected a stronger technology driven approach to expand rural education, which is missing from the budget announcement. The traditional classroom based approach to expanding education access will be a major challenge and instead a strong technology / remote education process would be more effective.
All in all, this is a pragmatic and growth oriented budget which incorporates the ‘rising tide lifts all boats’ philosophy while also specifically addressing some burning rural and social issues.
Pramod Saxena, Founder & MD, Oxigen Services
“In continuation of the PM Jan Dhan Yojana, we believe that this is an additional positive push to promote cash-less transactions and usage of digital money. The digitization of money at lower level and the JAM trinity (Jandhan, AADHAR and Mobile Access) will redefine and transform the economy to cashless. This will help in further alignment of the mobile wallets, cash in and cash outs and overall the mobile technology. We at Oxigen operate through Mobile, Pcs, Biometric point of sale terminals and BCs. Furthermore, our cash in/ cash out ports will further assist us in materializing the cash less dream. We are very positive on this push and support digitization at all level.” says Pramod Saxena, founder and CMD, Oxigen services India.
Rodney Noonoo, CFO, Xerox India
The Union Budget 2015-16 is a positive budget and step in the right direction. I appreciate the fiscal discipline and intent to reduce the fiscal deficit that stood at 4.5% of GDP in 2013-14 to 4.1% for the financial year 2014-2015 and subsequently reduce it to 3.6% in 2015-16 and to 3% in 2016-17. Overall I see a spirit of enablement, long term growth with announcements of multiple schemes aimed at bringing a change in the economic and social ecosystem that includes job creation, skill development, bridging the social divide etc.
The efforts on overhauling India’s business environment and boosting the country’s presence in the global map of ease of doing business is commendable. Right from cleaning up the links to tightening of processes and stringent laws for eliminating black money, monetizing gold-Sovereign Gold Bond will have a populist sentiment around it. The commitment to further this process through online central excise and service tax registration in two working days, issuance of digitally signed invoices and maintenance of electronic records and cutting down of paper work and red tapism will be a significant move in digitizing India and IT industry players like us will look at working more closely with the Government on such projects.
The government had promised to make it easy to do business in India and the intent is evident in the budget. The announcement to roll out GST from April 2016, reduction in corporate tax from 30% to 25% over 4 years, reduction of tax on royalty and technical fee as well as re-assurance on retrospective taxation will complement the efforts of improving investor sentiment and making India the next business destination. The focus on critical sectors like infrastructure and power & renewable energy construction as well as focus on skill enhancement are also steps in this direction.. While revised service charge rates increases the risk of more cash transactions at a micro, small industry level, but this is perhaps a necessary and important a step towards GST implementation.
The Budget on paper looks to be an outstanding ‘business plan’ with a roadmap for the next five years with right balance between social and economic objectives with focus on critical areas and now it is really upto how well it is executed on the ground.
Altaf Halde, Managing Director – South Asia, Kaspersky Lab
“Overall the budget is well structured. The announcement regarding bridging the digital divide between the urban and rural India is a welcome move. The announcement of allocating Rs 150 core to create world class IT hub in India under the Atal Innovation Mission is very encouraging. Skill development also got a special mention in the budget aiming the youth to be entrepreneurs rather than job seekers. This was followed by the announcement on supporting the startups. For IT sector, this announcement will for sure be a boosting one.
The rationalisation of service tax by including education cess is a good move. The increase will however impact our software sales. The lack of infrastructure development was a concern and it is well addressed in this budget with clear road maps and allocation. This will contribute to the overall development of the country. Reduction in corporate tax is also encouraging. The affirmation in the speech of Finance Minister Mr. Arun Jaitley, addressed the lost confidence among corporate India.”
Boost for Start-Up Ecosystem
Sanjay Deshpande, Co-Founder and CEO, Uniken
The first full-fledged budget of the Modi-led government has served to provide a broad directional roadmap for fiscal planning, infrastructure investment, planned expenditure and policy reforms. The government’s vision has been clear since they took over the reins 9 months ago – to lead India on a path of economic transformation. And, towards this end the government has rightly recognized the need to reimagine India as a hub for manufacturing & innovation.
The government has demonstrated great foresight in recognizing the potential of start-ups in contributing to this vision. Encouraging the spirit of entrepreneurship will provide a fillip to innovation, boost employment, enable an inflow of foreign exchange through exports, foster self-sufficiency and indeed, significantly contribute to India’s renewed economic growth.
As with the interim budget, this current budget recognized the start-up sector as an area for growth and development and has sought to launch a mechanism to boost entrepreneurship SETU (Self-Employment and Talent Utilisation), that has been envisaged as a Techno-Financial, Incubation and Facilitation Programme, is a welcome initiative. I am confident that the 1000-crore allocated by the government to SETU will go a long way in supporting all aspects of start-up businesses. By creating an ecosystem that allows start-ups to flourish, particularly those in the technology domain, the government can unlock India’s potential to create disruptive products and services.
With a progressive vision and timely investment, a pro-entrepreneurship Industry will lend itself to achieving sustained growth and create a global brand for India.
Sunil K Sinha – MD & CEO India Region, Sharp Business Systems India Private Limited
This Budget has two very important aspects; without which the Indian Economy cannot grow as is being widely expected. The first is, a conscious effort to narrow the gap between rural & urban India; without inclusive growth the Economy cannot gain traction. The other important initiative is the focus on building infrastructure. If the intent of the budget is translated into real action, the results are bound to appear in the foreseeable future. The path of gradual activism, even though contrary to expectation that had been widely created, is the right recipe for a large and diverse country like ours and lends itself to easier course corrections and more certainty in achieving the desired goals.
Bhaskar Venkatraman, Founder & Director, JusTransact.com
“The current budget spelt by our Hon. Finance Minister is extremely growth oriented and realistic given the current volatile economic situation in India. While there was a huge big bang announcement expectations from various quarters that was not to be, the budget yet provides necessary impetus for industrial growth & more specifically supportive on “Make in India” initiative not just for international companies but even for domestic SME establishments through the set up of Mudra bank to fund the dreams of budding entrepreneurs. The direction to implement GST (Goods & Services Tax) from April 2016 has given a very positive sentiment to Traders & manufacturers that would enable a uniform tax regime moving forward & simply their implications thereon. All in all, the budget is a welcome one without much disappointment to any section of the society.”
A K Bhuwania, Chairman at VXL Instruments
“By looking at this year’s Union Budget, I can say that India’s economy is about to take off on a faster growth trajectory. I feel that overall the budget is positive for all industries — healthcare, automobile, IT and others. It is encouraging to see that the government has reinforced its continuing focus on leveraging technology for development goals. Other announcements like electronic Trade Receivables Discounting System (TReDS) for SMEs, cashless economy, expanding direct benefits through JAM etc. are also a good sign. Furthermore, for technology start-ups, the FM has acknowledged the need of addressing concerns such as the need for a more liberal system of raising global capital, providing incubation facilities and easing norms for doing business. This budget clearly points that ‘Make in India’ is going to gain momentum this year. Reduction in royalty on technical services from 25% to 10% will encourage technology transfer to India. However, the increase in service tax is something that’s going to bother the industry as it is bound to increase the prices of many tech services. ”
Rafiq Somani, Country Manager India, ASEAN and ANZ
“With the current Government promoting domestic manufacturing via the ‘Make in India’, this initiative is taking good shape. In today’s budget the government emphasized heavy investment in infrastructure, defense, electronics and skill development. All consistent with transforming India into an indigenous self-sustained ecosystem for research, engineering and manufacturing. “
Dharmesh Anjaria, Executive Director, Dynacons Technologies Limited
1.What is your reaction to the latest budget announcement by the government?
This is a very strong and assertive budget. Emphasis has been on tax simplification, tax compliance and infrastructure spend which is the need of the hour. The levies on corporate taxation, rationalization of wealth tax, incentives by more expenditure towards infrastructure are all positives. Clarity on the rollout of GST is a very Big positive. This will greatly help in reducing tax complexity and multiplicity.
2.What points have been missed? What points have been covered well?
Reduction of MAT rate has been missed out. Also the government is relying too heavily on divestment to meet the fiscal deficit – the deficit target is also quite ambitious.
What’s good is – Firm roll out of GST and reduction in the withholding tax are positives which will increase the technology transfer to India. Allocation of Rs 1000 crores to help IT Start-ups is also a very good step.
3.Are you satisfied with this budget?
Yes – the budget is an assertive step to fiscal consolidation. People had a lot of expectations from the budget – the Finance minister has done a good balancing act.
4.What according to you are the biggest plus and minuses coming from this budget?
Certainty of GST roll out according to me is the biggest positive of this budget. Reduction in corporate tax from 30% to 25% over 4 years, reduction of tax on royalty and technical fee as well as re-assurance on retrospective taxation are positive measures.
Drawbacks will be seen on how FM manages the fiscal deficit.
5.What more could have been done in a better manner?
Rationalisation of certain duties and taxes would have helped in the build-up to the GST regime. MAT reduction would have been a positive step – especially in the SEZ companies as this will help give fillip to the exports.
Vinod Kumar, Managing Director at Satcom Infotech
1.What is your reaction to the latest budget announcement by the government?
Overall the budget is an investment friendly budget for our economy. The proposed cut in corporate tax coupled with universal social security scheme makes it a well balanced budget for all classes.
2.Are you satisfied with this budget?
Yes.
3.What according to you are the biggest plus and minuses coming from this budget?
The increase in service tax is an increased burden for the IT sector. On the plus side for the IT sector is reduction in TDS rate on technical fees and royalty the new tax exemptions for salaried is also a welcome plus from the budget. The budget also looks positive for curbing black money circulation in property transactions.
Rajiv Shah, Director at Asia Powercom
1.What is your reaction to the latest budget announcement by the government?
This is a bold and far sighted union budget which will help raise the country’s profile as an investment destination. It aims to make many structural changes that will help drive higher corporate investment on a sustainable basis. Also they include a commitment to simplify and rationalize the various taxation structures which sets a clear roadmap for the next four years. Decent balance of social reforms and growth initiatives have taken which includes ‘Make in India’, GST, Corporate tax and GST implementation which is big news.
2.Are you satisfied with this budget?
Yes, we are satisfied. Overall the budget looks positive.
3.What according to you are the biggest plus and minuses coming from this budget?
There was no big bang in budget but collectively budget has addressed total growth package by giving thrust to ‘Make in India’, GST, Gold Bonds, correcting inverted duty structure, Power generation, Education, Road and rail networking etc.
4.What more could have been done in a better manner?
Expectations were running high and there is no doubt that many will feel that this was not the defining moment for the Indian economy that they had anticipated. But overall it was a strong and structural budget with clear roadmaps to achieve the target of more than 7% economic growth in the next 3 years. Only concern with this budget was lack of sops for the middle class people.
Gopal Pansari, Director at Savera Marketing Agency Pvt Ltd.
- What is your reaction to the latest budget announcement by the government?
We welcome this budget as it is positive, growth oriented and puts forth realistic roadmap to attain sustainable economic growth.
- What points have been covered well?
This Budget is a sincere effort to address all class of society and bringing the economy back on track. Tax exemptions for middle class people, will in turn spur demand for goods and services, which would be a win-win situation for the overall economy of country.
- Are you satisfied with this budget?
Yes.
- What according to you are the biggest plus and minuses coming from this budget?
There are many positive moves, some big ones and some small ones in this budget. It is focused on ease of doing business, Make in India, infrastructure, social sectors. Introduction of GST from 1 April 2016 will definitely refresh the industry, make manufacturing more competitive and help common man a lot.
- What more could have been done in a better manner?
Union Budget 2015-16 has been termed as ‘Budget for the Corporates’ by the critics. The middle class and the common man had a lot of expectations from this but they seem to have been left high and dry. Including different initiates for them could have taken this budget to higher level
Richard Tan, MD & Director, ADATA Technology India Pvt Ltd
1.What is your reaction to the latest budget announcement by the government?
Overall the budget looks to be bringing in realignment in taxes for corporates and rationalizing the tax pay-out. One aspect that strongly comes out of this budget is that in the next few months the industrial growth would be more encouraging than at the current moment. The stress toward make in India looks to be gaining and that will surely benefit the local industries. However raising the service tax is something that is definitely going to pinch the businesses.
- What points have been missed? What points have been covered well?
One significant aspect that looks missing is the increase in income tax exemption limit which eventually would have much higher impact on the growth for industries. However small benefits like travel can be referred as a breather for the Income tax payer.
- Are you satisfied with this budget?
On a rating – I would give in a score of 6 out of 10 as though this is not a populist budget throwing in goodies like the earlier budget but clearly focusing on curbing out anomalies and bringing in a spurt in growth.
- What according to you are the biggest plus and minuses coming from this budget?
The biggest focus that the FM has kept is to stimulate the industrial and business growth that had been the main plank for coming to power and more over with no goodies or subsidies announced – it clearly shows government’ strength as a party having an absolute majority. Not coming out with anything substantial for the middle class in kind of any benefits is something that I feel that this budget has missed.
Reactions from Telecom Segment
Pankaj Mohindroo, National President ICA
Indian Cellular Association Welcomes Excise Differential on Mobile Manufacturing, advises Caution
National President of Indian Cellular Association, Pankaj Mohindroo has noted the Excise Duty differential of 11% on domestically manufactured mobile phones over imported phones. The step up in the differential from 5% in the pre-budget dispensation to the current 11% is designed to create the necessary pull for investments from India and abroad into the industry and will realize the “Make in India” programme, he said.
Mohindroo, however, cautioned that the Government will have to fine tune the differential keeping in mind that smuggling of finished mobile phones into the country from China has always been a big problem. The 11% differential when added to high VAT rate of 15% in major states will be very lucrative preposition for the grey market operators. He recalled that the previous NDA Government in the 1999-2004 period had brought the Excise duty down to zero on mobiles to curb smuggling from China. Even without the differential, FDI flowed into India with an organized World’s largest factory in Chennai was set up by Nokia during this period only.
Currently, the mobile market has grown to a high of Rs 1 Lakh Crores with compound growth rate of 30% plus. The differential will ensure that hunger of the Indian consumer can be fed by domestic manufacturing. But this has to be done in a manner which does not result in price rise for the common man, specifically in the low price feature phone segment, he said.
The ICA President advocated free trade in parts, components and accessories as well as technology without excise control or Income Tax deducted at source. These measures will also provide the right inputs for the ecosystem.
Mohindroo welcomed the proposed phased program of reduction in Corporate tax to 25% but felt that a 10-year tax holiday will act as the accelerator for faster results.
Hariom Rai, Co-Chairman of the Fast Track Task Force set up by the Government for promotion of mobile industry said that inclusion of Tablets in the same category as mobiles for promotion of manufacture for the differential 11% duty is a long awaited demand. The technology convergence of mobiles and tablets has been accepted by the new Government. The beginning of tablet manufacture will give a boost to the manufacturers and also the consumers for whom availability, service and price will be major gains.
Rai also welcomed the removal of 4% SAD for manufacture of all Electronics goods in the WTO IT Agreement which too will create the manufacturing ecosystem. Rai suggested that Laptops should also be in the same category as mobiles and tablets so that entire segment of computing and communication in the mobile sector moves together in harmony with each other.
Vivek Varshney, VP, and Head, Telecom, UST Global covering the budget reaction
“The Government has presented growth oriented and investor friendly budget. Allocation of 7060 cr. for 100 smart cities will give impetus to technology related spending. Government’s Digital India initiative to focus on broadband connectivity at village level with improved access to services through IT enabled platforms would go a long way in bridging the digital divide. Another welcome step is the setting up of National Rural Internet and Technology Mission for services in villages and schools, training in IT skills and E-Kranti for government service delivery and governance scheme. It is also encouraging to see the budget’s focus on employability and entrepreneur skills through setting up of Skill India program.”
Subhash Agarwal, CMD, Cheers Devices
1.What points have been missed? What points have been covered well?
The domestic manufacturing has been addressed very well keeping in mind the “Make in India” campaign announced in the Budget the previous year. The rationalization of VAT taxes was also crucial due to the grey market operators.
But there should have been some announcements for the e-commerce and mobile sector together as they are the next big thing and are significantly contributing to the revenue generation of the economy.
2.Are you satisfied with this budget?
The budget is progressive which will also let us take up new initiatives under the “Make in India” campaign. But it will have a contrary implication on the importers, who will be affected. So in my opinion, the makers of components and units should have been given a defined boost.
3.What according to you are the biggest plus and minuses coming from this budget?
The ‘positive intent’ by FM Arun Jaitley for the technology start-ups is welcoming. The allocation of Rs.1000 crore for the initial fund under the National Institution of Transforming India (NITI) Aayog will definitely boosts the start-up to support their businesses. Only the post-budget details and intricate details in print can give a better idea about the same.
The incentives for domestic mobile phone makers is very well done and bound to favour the Indian base manufacturers. But simultaneously, the excise duty have been increased up to 12.5 per cent. As an Indian brand with manufacturing in China, we expected some favourable proposition as our end customers are Indian and would have benefited further.
4.What is your reaction to the latest budget announcement by the government?
The Budget proposed to cut the rate from 25 to 10 per cent of income tax royalty and fees for technical services
. This is a definitely good move by the FM to ensure access to technology to the “young entrepreneur running business ventures or wanting to start new ones”
5.What more could have been done in a better manner?
The prices of excise duty may benefit and spur domestic manufacturing. But the domestic vendors import major stock of smartphones, which will significantly impact the increase in the prices of smartphones. Also, the limit to exemption from levy of SAD to inputs / components used in the manufacture of personal computers (laptops / desktops) and tablets should have been proposed in a much better way.
Extremely important issues like Cloud Protection laws, Cyber Security and Double Taxation on software, etc. remained unaddressed. Moreover, we were also looking forward to the implementations of the programmes announced in last budget like E-Kranti, Smart Cities and the 10,000 crore fund for SMEs, etc
As e-commerce is seen as a big force in India today, here are some of the reactions from the e-Commerce segment.
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.”
Amit Bansal, CEO, HealpingDoc.com
The increased healthcare budget allocation is step in the right direction but the amount is still far too less to built an effective and credible public healthcare system in India. The good news is that healthcare has started to get the due attention.
The increase in tax exemption limit for health insurance will have significant impact on the penetration of health insurance in the country. This would help corporates to offer a wider range of health packages, and would go further to reduce out-of-pocket health spending.
Sanjoe Jose, CEO, Talview.com
“The budget allocation for startups should be used to promote startups in Tier 2 cities and beyond. This can lead to significant generation of quality employment at par with city counterparts for youngsters in these regions. Areas to be focused should be technology, commerce and education/training”.
Diwakar Chittora, CEO, Intellipaat.com
“It is good to see a big step from Modi government towards boosting startups. IT indicates very clearly Indian government wants to build healthy environment for startups while is prevailing in US and Singapore.
If we are look at this allocation in details there is lack of clarity how these funds will be allocated, what is the duration for this will be available , what is the procedure to get the funds and what kind of startups are eligible and what is the slab of funding .
There are still some cases where government is doing this work but it’s of no use for many. To give an example, we recently spoke to STPI Jaipur they run a program whose objective is to boost startups under name of Startup Oasis (http://www.startupoasis.in/) which is in joint venture by RIICO and we approached them for using their facility for our office. They said we are not startup as our company size is 20 people and they denied providing us their facility. They have a facility of siting capacity of atleast 30 – 40 people free from last 6-8 months but still they are not interested in giving them to us.
Big problem here is to address even though government allocates budget but there is no clarity how to utilize, who can utilize, who is the right authority to take decision and what is the definition of startup?”
Ashutosh Modi, Executive Director, EntrancePrime.com.
A brilliant, well thought budget for all sections of society and businesses. Measures targeted on black money are very bold and long due. My top picks from the budget – electrification of 20,000 villages, digital India initiative to connect villages with technology, introduction of new IITs, IIMs and other premier institutes of higher learning, ensuring a senior secondary school within 5 KMs reach for every child, 1000 Crores budget for promoting technology startups, reduction of tax for royalty fees on technology services, initiatives like Nayi Manzil & Pradhanmantri Vidya Laxmi Scheme to promote education & skill development in India, Reduction of corporate tax by 5% over 4 years.
However, execution and enforcement plan for influx of larger funds in schemes like MNREGA will be interesting to read. As expected, increase in service tax to make way for GST will be hard of Indian pockets. We were expecting a reduction in ROI for Education loans, however, some of it is taken care of with Pradhanmatri Vidya Laxmi Scheme.
Looks like an immensely progressive budget on face value, as an Ed-Tech company we see some really good opportunities coming out of this budget, look forward to details and execution plan.
Ramut Sethi, Founder and chief mentor Career Co.
“FDI would be favorable for us as it will generate job opportunities and help people to find their career. But we are not happy with 14% tax on companies..And also, the amount allocated for startups is too less”.
Abhinav Choudhary, Co-Founder, Smartprix.com
“Budget 2015-16 may prove to be A Game changer for tech startups in India. According to Economic Survey 2014-15 Indian Tech startup landscape to be in the mode of hyper-growth. In line with the growth, allocation of 2000cr for startups will definitely be seen as a positive sign from Govt.
FM announcement of reducing corporate tax from 30% to 25% in the next 4 years will increase the expenditure power on marketing and technology of Smartprix.com
– An online comparison shopping website and creation of more jobs in the technology sector is expected in the upcoming years. Reduction in the rate of income tax on royalty and fees for technical services from 25% to 10% is a welcome move”.
Tapan Kumar Das, CEO and Co- Founder of iTiffin.in,(Intelligent Tiffin) an online and offline healthy meal providing company , says “The allocation of Rs 1000 crore for start-ups was one of the major announcements of this year’s budget. It’s definitely a breakthrough move for entrepreneurship in the country but the implementation of the same is a daunting challenge. Reduction of corporate tax by 5% is another step that favours emerging companies immensely. But, according to me, for start-ups, it’s the growth of the company that matters more than just making profits. Looking at the positive side, the saved money can help companies invest in employee training to enhance their productivity. The announcement to set up Mudra Bank for priority to SC/ST entrepreneurs will greatly boost confidence in the business eco-system but again implementation will be the real game-changer. Lastly, bolstering cashless transactions through RUPay debit cards and reduction of tax on royalty fees for technical services by 15% will be of tremendous help to e-commerce start-ups”
Suresh Sharma, Founder & Director , iSpyPrice.com, a leading price comparison website says ;“I am elated with Rs 1000 crore fund that has been allocated for start-ups, especially those that are technology-based. This announcement will encourage entrepreneurship and generate more employment opportunities in the sector. Also, the reduction in corporate tax from 30 % to 25% over the next four years is encouraging for e-commerce companies as low tax is equivalent to more inflow of cash. The promotion of cashless transactions through RUPay debit cards also works for the benefit of internet-based companies as this will reduce the propensity for Cash on Delivery, which is very high at present. Besides this, the tax reduction on royalty fees for technical services from 25% to 10% will make these services more cost-effective and bolster the operations of various tech-based firms.”
Ashish Sood, Co- Founder, Youshine, India’s only omni channel fashion jewellery & accessories retail brand says;”It is excellent that the Indian entrepreneurial system is being encouraged by the announcements of a start-up Fund of Funds and the special MUDRA Bank to take of MSME funding needs. Being a very young population, these measure will go a long way promote entrepreneurial activity in India. However, it is disappointing that GST implementation has been put forward by another 12 months. Retailers like us, who are looking to establish a Pan-India presence were really looking forward to this announcement.”
Suvro Ghosh Founder HelpMeDoc.in, says, “Arun Jaitley’s budget has been very encouraging… truly inspiring for all entrepreneurs and the youth of India. As a first-generation entrepreneur, I know how hard it is to chase a dream. It would be splendid for India to not only get ideas from its brain-bank, but also get support from the Government. This way the young, driven youth can fulfill their dreams and make significant contributions to the domestic economy over the coming years. Welcoming FDI is a cornerstone for a turnaround and to create and enhance infrastructure.
Making current loans refinanced for MSME segment will let corporates think better and will help them create more jobs. It’s a huge temptation for expansion of the present MSME segment and to think differently. Reduction of corporate tax to 25% from 30%, shows a powerful vision.
Social security, healthcare and insurance has been taken into consideration and this is commendable. An attempt to make transactions cashless to stop black money exchanges is a well-thought move. This step will reveal its real value, gradually, in the times to come. Overall, this has been a progressive budget, looking towards a modern India.”
Swaminathan Vedaranyam Chief Executive Officer, VIA.com
“The Finance Ministers’ proposal to increase Visa on arrival scheme from the current 43 countries to 150 countries is a very welcome as it will push the incoming to India dramatically which will in turn help the entire local eco system of India. It’s proposal to invest in heritage sites was a much awaited and extremely beneficial move as there was an urgent need for well-defined policies and clear commitments to ensure that all cultural heritage points are given more attention with improved infrastructural facilities. There is a recent spurt in domestic travel as well as a higher influx of foreign tourists in India and with dedicated upkeep of the tourist hotspots, we can ensure higher growth for the travel industry. The reduction on the Corporate tax is another major move that will help companies put aside more cash which can be be ploughed back into the business.
Shefali Singh Founder of Mysha, a complete online travel solutions to corporate clients, specialising in MICE Tourism says;”Arun Jaitley’s budget included some very positive announcements for the travel and tourism industry. The fact that the government will open up Visa on Arrival facilities to 150 countries, from the current 43, will result in a high inflow of tourists. The emphasis on restoration of World Heritage Sites is also likely to bode well for the sector as it will induce both domestic and foreign tourists to travel to these spots. Additionally, for a company such as ours, which offers complete travel solutions to MICE and Corporate clients, the reduction of corporate tax will result in a boost for the overall business”