Union Budget 2016-17: What India Inc expects

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Updated: Feb 27, 2016 5:10 PM

Industry is hoping that the Budget will will be keenly watched as it may give fresh direction to the economy, business and markets.

Arun Jaitley - Union Budget 2016Union Budget 2016: Finance Minister Arun Jaitley will present the budget for the financial year 2016-17 on February 29 amid global economic slowdown.(PTI)

Finance Minister Arun Jaitley will present the Union Budget for 2016 amid a global economic slowdown. Industry is hoping that the Budget will will be keenly watched as it may give fresh direction to the economy, business and markets.

Below are the expectations from corporate leaders on Union Budget 2016-17:

Sashank Rishyasringa and Gaurav Hinduja, Co-Founder, Capital Float

“The Prime Minister’s action plan on startups was the first step to aid the growth of the entrepreneurial ecosystem in India. We hope that the budget will lay the groundwork to create more opportunities for innovation in the startup sector especially in the Fintech space. We expect this budget to bring parity between the NBFCs and other financial institutions. We believe that this budget would also look at providing monetary incentives under Skill India to small-scale entrepreneurs to help them impart specific training to unskilled labour and a flush of capital into the Technology Acquisition and Development Fund (TADF), meant to help business to acquire the requisite machinery and technology to expand their operations.”

VP Mahendru, chairman Eon Electric

“There is need to promote LED lighting industry as it will go a long way to save power for the nation and reduce pollution as already committed by us at the concerned UN forums. From the industry point of view, there is a need to provide income tax benefits to LED manufacturing companies, Accelerated depreciation benefit to LED plants and push towards faster implementation of GST. The government should set up an interest refund rebate for manufacturers who have shifted to LED production. Further, excise duty exemption should be extended for LED lighting manufacturing companies present in special industrial promotion zones, like Haridwar because of the intensity with which the demand for LED Light is increasing.”

George Alexander Muthoot, MD, Muthoot Finance Limited
“We envisage that given the significant role played by NBFCs in supplementing the banking industry, the budget will strengthen the role of NBFCs in the economy, especially well-run NBFCs with net-worth of more than Rs 5,000 crores. As financial empowerment through financial inclusion is one of the key motos of the government, we expect that the budget will have measures directed towards reinstating gold loan under priority sector lending as we believe that gold loans can be a useful tool in achieving the objective of Pradhan Mantri’s Jan Dhan Yojana where more than 11 crore accounts have been opened.”

Umesh Revankar, MD & CEO, Shriram Transport Finance Limited
“Infrastructure should be main focus of this year’s budget. ‘The Make In India’ campaign’s success hinges totally on support system and enabling environment. India needs faster & efficient connectivity between ports, railways to the site plants that would reduce logistics cost which is probably one of the highest in the world for movement of goods. Attracting Investment in defence and high technology is essential to bring in knowledge and encouragement for high technology to flourish in India. Encourage higher investment in power sector is very important as the demand for power is likely to go up further. Further push is required in increasing manufacturing activity especially in MSME segment. The MSME segment not only creates more employment opportunity but also exports.”

Brotin Banerjee, managing director and CEO, Tata Housing Development Company
“The government should grant infrastructure status to integrated townships so that banks are able to give priority sector lending to the sector. Incentives and special benefits to green and sustainable technology and methods of construction should also be addressed in the upcoming budget. Real estate sector continues to be plagued by the issue of double taxation and tax complications which drive up the cost of construction and eventually make housing more expensive for consumers. It is also required that the budget encourages demand by increasing the deduction available for interest on housing loans from Rs 2 lakhs to Rs 3 lakhs per annum in keeping with interest rates which are still high despite successive rate of interests last year which are yet to be translated by banks.”

Ravitej Yadalam, CEO & Founder, Pennyful.in
“One of the biggest expectations is the tax exemption on savings, however, businesses have their own eye out for possible budgetary benefits, that could transform their industry over the course of the year. One of the expectations is in the sector of retail where the relaxation of FDI limits could potentially create employability in the country. Changes and transformation in certain regulated policies could promote foreign direct investment in the country. There is enormous expectation that the government might provide exemptions and benefits in the e-Commerce sector that is currently booming in India.”

Kamal Poddar, managing director, Choice Group
“While the finance minister is walking a tight rope to maintain fiscal prudence, a clear fiscal consolidation roadmap may help bolster foreign and domestic investor sentiment, and help power growth in the economy. Fiscal consolidation may also facilitate the economy by way of increased interest rate cuts from the Reserve Bank of India to help kick-start the private investment cycle.”

Prafulla Mathur, Founder and CEO, WudStay

Union Budget 2016-17 is eagerly awaited by the Start-up fraternity after the ‘Start-up India’ initiative last month. There is noticeable anticipation in the startup ecosystem, post the very promising support extended by the Union Government during the Startup India action plan announcement. All eyes are fixed on the upcoming Union Budget, and we are expecting introduction of manifold policies to take forward these announcement, hence setting forth further pace for the Start-up businesses.

– Lessening the load of entrepreneurs by discarding unnecessary paperwork and accelerating documentation processes will help them save time, and extend their abilities towards value creation.
– A friendly Tax Regime, specifically designed for the Start-up fraternity needs to be set in motion at the earliest. Waiving off the income tax for initial years along with other tax breaks will be a big boost for the Start-ups.
– Ease of accessibility to capital by comforting qualifications of angel money, and encouraging a healthy bureaucracy system will further open up possibilities for the Start-ups to grow and flourish in this new era.
– The pending GST bill is a welcome move for Start-ups. Amongst the various proposed guidelines under GST, it is expected that standardized and centralized registration cell will be set up for getting indirect tax-related registrations done. This will benefit Start-ups by reducing time and effort towards documentation.
– The need of the hour is a tourist friendly tax structure, which includes exempting Service Tax on foreign exchange, Luxury Tax – charged by the State, Value Added Tax (VAT) – on Food and Beverage, Excise Duty – on Beverages, among others. Also, new policies should be introduced to encourage investment in this sector. Another important aspect is to allocate funds and create guidelines to promote India as a tourist friendly and safe destination for women to travel.

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