Unveiling India’s economic pulse! A glimpse into demands and expectations from key sectors

Arun Surendra – Group Managing Director, VST Group:

“In 2023, for the first time, India surpassed Japan in auto sales and became the 3rd largest auto market in the world. While the tier 1 cities have started to see a better adoption of EV vehicles, tier 2 and 3 cities are still challenged due to factors like power cuts, fluctuations in the voltage etc. Home charging for EVs is a challenge in multi-storey buildings, as often you have one allocated car park. The charging car parking spot is often a shared one limiting flexibility on usage. Unless multi-storey buildings invest in multiple charging points, quicker adaptability will be slow.

We can expect a higher allocation in the forthcoming budget, with a lot more emphasis on the backend infrastructure such as tax breaks or subsidies into imports of critical components that go into the EV battery manufacturing, and in accelerating the building of the charging infrastructure. An extension of Faster Adoption and Manufacturing of Electric Vehicles (FAME-II) subsidies and tax deductions to incentivise the EV players in the industry like Tata, Kia and Mahindra will spearhead the acceleration and adoption of EVs in India.”

“Anticipating the forthcoming 2024 Budget, there is a collective call for the Government to amplify its investments in healthcare infrastructure, providing an environment conducive to the affordable blossoming of creativity. Recognizing the unique hurdles faced by emerging healthcare ventures in engaging traditional investors, there is a strong plea for targeted support within incubation centers, fostering the growth of pioneering firms. This not only enhances the industry but also bolsters the ‘Make in India‘ initiative. Government intervention holds the key to the enduring prosperity of the healthcare sector, paving the way for the flourishing of new enterprises. The hopeful expectation is for a budget that not only ignites innovation but also champions inclusivity, laying the groundwork for a healthier, more self-reliant nation,” says Hari Subramaniam, Founder & Director, LifeSigns

Lalit Attal, Partner, Tax & Regulatory Services, BDO India

Pricing of Corporate Guarantee fee: Most of the taxpayers in India price their inter-company corporate guarantee (CG) fees in the range of 0% (no charge) to 0.50% of the amount utilized under the CG cover, based on the variety of underlying facts. The Income Tax Appellate Tribunal, for matters under dispute, has held pricing of about 0.50% in hundreds of cases.

CBDT, on the other hand, devised a price of 1.75% / 2.00% under the safe harbour regime (Rule 10TD(2)) and agreed to a price in the range of 0.40% to 0.60% under the Advance Pricing Agreement framework.

Furthermore, the Rule 28 of CGST rules, 2017 (effective 26th October 2023) deemed 1% or actual amount charged, whichever is higher, as the price of CG, is to be read in the context of related party transactions.

The plain reading of the issue itself clearly depicts the need of harmony between the laws and bridging the wide gap in the pricing of CG at multiple forums within the Government body/jurisprudence. We recommend the following:

1. Detailed guidance to be issued discussing the factors which impact pricing of CG in the light of recent OECD guidelines (2020) on the financial transactions and acceptable approaches to price the fee on CG.

2. Indirect taxes and direct taxes to achieve harmony by providing necessary guidance under both the laws which will reduce the ambiguity faced by Indian taxpayers on this topic under both the laws simultaneously.

BEPS 2.0: The global minimum tax is already a reality where multiple jurisdictions have issued legislations or guidelines. This move will disincentivize tax heavens and protect India’s taxing rights. Some of the Countries in EU, APAC and UK implemented laws beginning January 01, 2024 / during the calendar year 2024 around Qualified Domestic Minimum Top-Up Tax (‘QDMTT’), Income Inclusion Rule (‘IIR’) and Undertaxed Payments Rule (‘UTPR’).

The Budget 2024 may introduce provisions enabling IIR and UTPR to levy top-up tax rate either by amending Income Tax Act or introducing a specific legislation (which would need appropriate remedies to avoid double taxation). It may lay down the foundation for implementation of GloBE rules for computing the effecting tax rate, reporting of information and ways to evaluate the substance based carve outs to ensure that entities carrying on substantive economic activities are least impacted by these rules.

Gunjan Prabhakaran, Partner & Leader, Indirect Tax, BDO India

Amendments in Customs Law:
Amendment in Section 46(3) of the Customs Act
Currently, the time limit for filing the Bill of Entry (BoE) for import is before the end of the day (including holidays) preceding the day on which the aircraft or vessel or vehicle carrying the goods arrives at a customs station at which such goods are to be cleared for home consumption or warehousing. While this time limit is sufficient and workable when the shipment is arriving by sea, for air shipments, which are normally opted to meet the urgency of production and not pre-planned, with transit period as minimum as few hours in cases of import from Malaysia, Thailand, Dubai etc., importers face challenges to file the BoE within such a time limit. Suitable guidelines or amendments are required for addressing to this challenge.

Amendment in section 149 of the Customs Act
1. Currently, in cases where Customs Demand has been raised by Revenue and accepted by the Taxpayer, the re-assessment of BoEs takes substantial time. Hence, in the interest of time, the taxpayer generally pays the differential duty through Manual Challan. However, such Manual Challans are not considered as valid documents for availing the ITC under GST of IGST portion of customs duty. Hence, importers are facing financial hardships in such situations. Prescription of a fixed timeline for amendment/reassessment of BoEs is required as a trade facilitation measure and to avoid hardship to the importers.
2. Currently, the importers cannot apply for amendment of the BOEs in case of shortages, wrong currency, excess or wrong goods, wrong Importer on Record or any other notification-based exemption post importation in absence of specific applicability of Section 149 of the Customs Act. Suitable amendment in Section 149 of the Customs Act to cover these issues would avoid hardship to the importers.

“While this is an interim budget, giving a timeline to implementation of Labour codes will be helpful especially at a time when India is attracting FDI in manufacturing in particular and new investors will find the labor code increase the countries ease of doing business dramatically. The lack of women workforce is another concern, the government can allow companies to use their CSR funds to create Dormitories for women workers near their manufacturing plants which can encourage more young girls to join Formal work and enjoy safe and stable environment. Another initiative could be to provide transportation for women workers in urban areas, especially for night duty personnel, such buses should be under special fund that allows Women only, including women drivers and conductors. India has the maximum participation from MSME sector and is the real powerhouse for increasing women participation in workforce. However, if they are hiring women workforce, they need support towards maternity benefits as subsidy, as this has notably become an additional burden for MSME and discourages the governments agenda to create more opportunities for women in the workforce for MSMEs. Also, the segments to create formalization in domestic workers need a government impetus to drive the change. One of the suggested ways will be to incentivize taxpayers through tax rebates for individuals who are contributing to formal employment through social security, and minimum wages towards domestic workers in their homes. The Government can approve a special standard deduction for all individuals who hire other persons at their homes and treat such individuals as employers provided the amount paid is above minimum wages, paid via a bank account that is Aadhaar-seeded. The Budget can make provisions to encourage employer organizations to invest on skilling their existing workforce and making them future- ready. Companies that create 1st time formal jobs mainly in the frontline segment where majority of the job seekers have incomplete education should be encouraged to hire from different regions and bring them not only into formal employment, but also link them to skilling eco system, especially for expert services, as the skills required in workplaces are evolving constantly with disruptive technological advancements,” says Lohit Bhatia, President, Indian Staffing Federation.

Deepashree Shetty, Partner, Tax & Regulatory services, BDO India says:

1. Increase in standard deduction from salary income:

Standard deduction of INR 50,000, as the case may be, was introduced in lieu of the exemption of transport allowance and reimbursement of miscellaneous medical expenses. The same has now been allowed under the new tax regime. Considering the inflation, we can expect a raise in the amount of standard deduction that can benefit salaried individuals in the higher slabs.

2. HRA to include – Bangalore and Hyderabad under 50% limit cities considering their current cost of living:

HRA is given by employer to cover the cost of living in a rented accommodation. For the purpose of exemption (or is it deduction), a higher limit of 50% of basic salary and dearness allowance (one of the conditions) is available for those living in metro cities i.e. Chennai, Delhi, Kolkata and Mumbai.

3. Extension of 80D limit to New Tax Regime:

Deduction under section 80D of the Act regarding repayment of premium relating to medical and health insurance policies is currently available only for individuals opting for old tax regime. This should be extended under new tax regime too as medical expenditure is a basic necessity/expense for individuals.

4. Deduction for education loan:

Section 80E deduction which is currently available only under old tax regime, should be available under new tax regime too. This could help promote Government-backed schemes such as Atmanirbhar Scheme, Startup India Scheme, Skill development schemes etc. and enhance entrepreneurial skill development of the youth taxpayers.

Preeti Sharma, Partner, Tax & Regulatory Services, BDO India: Most Indian taxpayers have the habit of initially investing their savings in investment avenues that provide tax deductions under Section 80C (i.e. INR 1,50,000). Additionally, the salaried class claims exemptions such as HRA, LTA and housing loan deductions. For an individual earning a salary income of INR 10 Lakhs, the old regime is more favourable in case exemptions / deductions exceed Rs 2,50,000. This situation applies to most taxpayers leading to acceptance of the New Tax Regime (NTR).

The New Tax Regime provides favourable results for taxpayers up to an income level of Rs 7,50,000. To increase acceptance for NTR, the government should allow deductions under this regime, for say employee’s contribution to PF (under Section 80C) and employee’s contribution to NPS (under Section 80CCD). This would also promote the habit of building a retirement corpus for individuals.

The presence of two regimes has also created complexity for the taxpayers. A clear transition plan to eventually move to one system of taxation is also warranted.

M&A – Kunal Gala, Partner, Deal Value Creation, BDO India: “In anticipation of India’s 2024 budget, expectations are high for impactful economic shifts. Key forecasts suggest a strategic cut in corporate tax rates, aiming to reduce the fiscal deficit to 5.2% of GDP in FY25. There is a strong focus on greener fuels aiming to revolutionize the energy sector. Additionally, targeted support for microfinance institutions is anticipated, enhancing their reach and stability. As elections approach, the budget is expected to include prudent populist measures, striking a balance between economic strategy and voter appeal.”

As Finance Minister Nirmala Sitharaman prepares to unveil the interim Budget for the fiscal year 2024-25 on February 1, 2024, the logistics industry anticipates government proposals that will sustain the focus on capital expenditure for the development of transportation, port, and digital infrastructure. This strategic approach aims to enhance logistics efficiency and competitiveness, aligning with the objectives outlined in the National Logistics Policy. Rampraveen Swaminathan, MD & Chief Executive Officer of Mahindra Logistics Ltd, emphasized the upcoming interim Budget as a unique opportunity to strike a balance between economic growth priorities and fiscal consolidation. Swaminathan suggests that prioritizing capital expenditure in key infrastructure projects, coupled with financial incentives like Production Linked Incentives (PLI), tax benefits, and subsidies, can foster innovation in the logistics sector. He highlights the importance of building a unified logistics ecosystem across India and integrating initiatives such as the National Logistics Policy and the Sagarmala Project to significantly improve India’s global Logistics Performance Index ranking.

Read More Here: Logistics cos expect continued govt capex push towards logistics efficiency, other financial incentives

Vikram Kulkarni, Partner, Indirect Tax, BDO India: Alcoholic liquor for human consumption is outside the purview of GST. However, State Governments levy Excise & VAT on the same. The Alcobev industry is looking forward to the Union Budget 2024 and expecting measures that would be beneficial to the industry. Some of the pressing issues affecting the Industry are as under:

1. The GST council in its 52nd meeting on 7 October 2023 had approved the exclusion of Extra Neutral Alcohol (ENA) from GST. However, the government has not issued any notification to grant this exemption. The industry eagerly awaits the same as it would help reduce the costs to a large extent.

2. The industry has been demanding for a long time to include alcoholic liquor for human consumption, under the GST purview. This would bring this industry at par with the other industries and also reduce the cost burden on account of non-availability of ITC on inward supplies.

Puneet Mishra, Partner, M&A Tax & Regulatory Services, BDO India: Capital gains require an overhaul. Currently, capital gains are taxed as long term or short term based on their holding period, and the tax rates on these capital gains vary, creating complexity. Rationalizing and standardizing the capital gains regime with regards to certain aspects e.g., streamlining of holding period i.e. long term or short term, uniformity in long term/ short term tax rates across various asset classes, a change in base year for indexation for long-term capital gains etc. would be favourable to the investor community at large. Aligning these changes with the visions of the government for encouraging taxpayer-friendly initiatives such as common income-tax return forms, annual information statements etc. could enhance overall compliance.

Sanjiv Malhotra , Senior Advisor, Shardul Amarchand Mangaldas & Co: With the vote-on-account less than a week away, the conversations around what to expect

from the so-called interim budget has gathered momentum. Even though the Finance

Minister has advised against expecting any “spectacular announcement”, one cannot refrain

from anticipating certain amendments to the direct tax laws. From a macroeconomic perspective, Government will be closing the current fiscal year with

a record direct and indirect tax collections. This along with other factors has also boosted the tax to GDP ratio. Thus, it seems that Government has room to promote expansionary policies with enhanced allocations on identified sectors and / sections. This should also, hopefully, mean that increasing the tax rates and tax base is not high up on the agenda of the Government, at least for the current vote-on-account.

Poorva Prakash, Partner at Deloitte India: To make the New Tax Regime more attractive, the general public looks forward to the government considering the following:

i. Decreasing the income tax rate to 20% for income ranging from Rs 10 lakh to Rs 20 lakh and to 25% for income exceeding Rs 20 lakh.

ii. Increasing the standard deduction from INR 50,000 to INR 100,000.

iii. Extending the rebate under Section 87A to Non-Residents.

Jyoti Prakash Gadia, Managing Director at Resurgent India on Pre-budget expectations:

1) The Banking sector has shown revival and resilience recently and can take up the growth path with greater vigour. Climate change funding and green finance, the need of the hour for the economy will require budgetary support. Therefore we can expect a mechanism of tax incentives and subsidies applicable to the banking sector to attract green deposits from the general public and promote financing of climate change adaptation and mitigation activities of corporates and other entrepreneurs. Infrastructure funding is also expected to be provided continued thrust. Privatisation of select PSU banks can also be taken forward, further to the announcement in the previous budget.

2) The MSME sector continues to play a crucial role in contribution towards GDP growth and employment generation and therefore requires special treatment by way of facilitating cheaper finance and support in supply chain management. Provision for timely payment of corporate debtors of MSME is still a challenging issue that needs to be addressed through fiscal support. Further expansion of ODOP (one district one product) plan at the national level with suitable incentives is also expected for the MSME sector.

3) NBFCs are an important integral part of the Indian financial system and need to be supported with adequate fiscal incentives. The recent RBI guidelines of RBI for additional risk weights on NBFC funding will make procurement of funds by NBFCs costlier, impacting their operational cost and Net interest margins. The NBFCs will expect to be suitably compensated with tax incentives and a wider role for NBFCs with deeper opportunities in microfinance and trade finance.

Dr. VP Singh, Director – PGDM & Professor – Managerial Economics & Statistics, Great Lakes Institute of Management, Gurgaon: “This year we expect to see an extraordinary budget regarding education. This government this government’s budgets in the past have emphasised a lot on infrastructure where allocation increased 4 times from Rs 2.5 lakh crores to 10 crores. Jan Dhan Yojana has enabled financial inclusion by bringing more than 50 crore people under formal banking; almost similar number of people benefitted from Aayushman Bharat PMJAY scheme by getting health insurance; 81.35 crore people have been benefitted from the PM Garib Kalyan Anna Yojana; Jan Jeevan mission has been announced; 100 per cent rural electrification has been achieved. Almost all social sectors have been impacted through past budgets. This time it is highly likely that the education sector will get a big boost. There may be 100 per cent increase in allocation to education sector.”

Ms. Shashi Banerjee, Director of Education, Shiv Nadar School: The budget for education needs to empower our youth to be ready for a fast-evolving world. The interim budget can lay the groundwork for NEP’s vision and objectives with IC2: infrastructure, capacity and collaboration. In order to increase the Gross Enrolment Ratio (“GER”) in higher education, including vocational education, from 26.3% (2018) to 50% by 2035, we require investments and capacity addition. Plans such as integrating Anganwadis with elementary schools and including a “Preparatory Class” or “Balavatika” before Class 1 require additional infrastructural facilities, building teacher capacities and hiring additional teachers in elementary schools. Similarly, extending health check-ups and growth monitoring and schemes such as PM Poshan and Swayam require budgetary support. We may also see a trend towards increased international collaborations through Multi-disciplinary Education and Research oriented Universities, along with EdTech and other private institutions through internships and training.

Vivek Tyagi, Managing Director, Analog Devices Inc India: “As we approach the Union Budget 2024, we at Analog Devices Inc are hopeful for a forward-looking fiscal roadmap that steers the nation towards technological prowess and sustainable growth. We believe the upcoming budget will play a crucial role in shaping India’s economic development, particularly in emerging sectors like semiconductor, e-mobility, green hydrogen, and renewable energy. Recent commitments observed at the Vibrant Gujarat Global Summit 2024 underscore the industry‘s collective dedication to Indian Government’s vision of a ‘Developed India @2047.’

In this dynamic landscape, we encourage policies that bolster indigenous semiconductor manufacturing ecosystem. The announcements by global players to invest in Gujarat highlight the sector’s potential and the need for a conducive policy environment. We believe that the budget should be a catalyst for nurturing innovation, research, and skill development, particularly in frontier technologies like artificial intelligence, 5G/6G networks and renewable energy.

As the world embraces the integration of 5G technologies, AI-enabled solutions and sustainable practices, we look to the budget to provide a strategic framework that not only navigates current challenges but also sets the stage for India’s emergence as a global technology and innovation hub. In essence, the forthcoming budget represents a pivotal opportunity for India to fortify its position on the global stage, and Analog Devices Inc remains committed to contributing to this transformative journey.”

Prof. Vishwanathan Iyer, Senior Associate Professor and Director of Accreditation – Finance and Accounting, Great Lakes Institute of Management, Chennai: “As India eagerly anticipates the fifteenth budget on Feb 1, 2024, the evolving landscape of budgetary presentations underscores the need for a strategic shift. Past budgets, marked by a heavy emphasis on capital expenditure, now witness a favorable economic scenario, prompting expectations of a nuanced fiscal strategy. With the nation’s focus on education intensifying, the need to align capital expenditure with investments in human resources becomes paramount. The implementation of NEP 2020 necessitates a substantial commitment to address the scarcity of human resources in Higher Education Institutions. The glaring disparities in the Faculty Student ratio and internationalization indicators, as highlighted in the QS Asia University Rankings 2024, emphasize the urgency for substantial fiscal support. While the proposed 100% increase in the education budget to Rs 2.25 trillion may seem daunting, robust tax collections and a significant surplus in revenue create a conducive environment for a transformative leap. The nation looks to Budget 2024 as a stepping stone towards bridging global gaps in education and fostering a new era of academic excellence.”

Yuvraj Shidhaye, Founder and Director, TreadBinary:

Fintech Sector – “As the finance industry looks forward to the Union Budget FY24-25, our aspirations revolve around driving technological advancement and fostering inclusive growth. Priority lies in initiatives to develop the workforce, especially in equipping the youth with digital skills. Empowering MSMEs in Tier-II and beyond with robust fintech solutions is crucial for broader economic empowerment.

Strengthening cybersecurity frameworks is vital to ensure secure digital transactions and maintain user trust. Expanding fintech services into underserved regions is a priority to enhance financial inclusion nationwide.

Stringent measures against digital fraud are imperative to safeguard digital payment ecosystems. This budget marks a pivotal moment for the fintech industry. With strategic support and allocations, it can pave the way for a thriving environment where fintech innovation propels India‘s economic progress.”

Arun Awasthy, President & Managing Director, Johnson Controls India, says, “In today’s global context, the question of climate change and decarbonisation looms large, and has unanimously emerged as the top priority among all nations, demanding strategic leadership at all levels. With buildings globally contributing to 40% of carbon emissions, the opportunity for transformative change in this domain is significant, particularly in a developing nation like India. As we approach this year’s Union Budget announcement, there is an expectation that the momentum of the Green Growth initiative from the previous year will strengthen, reflecting a sustainability-first approach.

Strategic investments in sustainable practices can act as a catalyst, propelling India towards decarbonization. This requires a more multi-dimensional approach, including greater incentivisation of green and smart building practices and certifications, encouraging the adoption of energy- efficient designs, and advancing skilling efforts in green and smart building technologies. As the nation collectively works towards achieving the net-zero target, we are optimistic that the Union Budget will reflect this commitment by widening access to sustainable solutions, enhancing affordability, and convenience for all stakeholders, ensuring a truly inclusive and environmentally responsible future.”

The Federation of Indian Chambers of Commerce and Industry (FICCI) has put forth a comprehensive set of recommendations in anticipation of the Interim Union Budget for 2024-25, outlining a strategic roadmap to strengthen India‘s economic foundation, reported ANI. The proposals cover various sectors, including public investments, support for micro, small, and medium-sized enterprises (MSMEs), innovation, taxation, and the burgeoning start-up ecosystem.

At the heart of FICCI’s recommendations is a fervent call to sustain and enhance the focus on investments. The organization asserts that India is at a pivotal juncture, and given global uncertainties, the government should persist with significant investments in the upcoming budget. Additionally, FICCI advocates for the establishment of an ‘Indian Taxonomy’ for green finance. This proposal is rooted in the belief that a well-defined standardized taxonomy, comparable to global frameworks, is crucial for evaluating exposure to sustainable versus non-sustainable activities. FICCI argues that such an approach would enhance transparency in the financial sector, compelling institutions to align sustainability targets with national and global goals.

Over the past four years, the reliable and significant financial assistance provided to Indian Railways has played a crucial role in preventing the need for annual borrowings, which would typically amount to Rs 60,000-70,000 crore. This strategic financial support enables the railways to concentrate on constructing new infrastructure without the weight of substantial borrowing. This trend underscores a transition towards the government’s increased gross budgetary support as the principal funding source for capital expenditures in vital infrastructure sectors like railways, roads, and highways.

Read More Here: Budget 2024 | Indian Railways’ ambitious leap: Boosting infrastructure and efficiency through budgetary support

Uday Narang, Chairman, Omega Seiki Mobility: “For India’s electric vehicle revolution to truly shift gears, three factors must align: affordability, accessibility, and sustainability. Affordability hinges on continued government support: Reduced GST on lithium-ion batteries and the introduction of FAME 3 with clarity on subsidy of electric trucks, alongside domestic battery manufacturing and skilling initiatives. Accessibility demands a robust charging infrastructure that reaches beyond metros, powered by clean energy sources and bolstered by open data standards for seamless charging. Sustainability, a focus on responsible end-of-life battery management, with R&D in recycling and circular economy measures leading the way. Prioritising these pillars is the only way India can unlock the true potential and adoption of electric vehicles,”

Ajinkya Firodia, MD, Kinetic Engineering: “In the upcoming 2024 budget, we are looking forward to several changes in the economic landscape. Foremost among them is the anticipation of subsidies for companies undertaking substantial, long-term investments, fostering economic growth. With a significant portion of electronic key components still imported, there is a need to incentivise local manufacturing of crucial elements like battery cells and magnets for motors. Enhanced import duties for non-electronic components aim to bolster domestic manufacturing, addressing concerns about substandard imported goods tarnishing the sector’s reputation.”

Maxson Lewis – Managing Director & CEO at Magenta Mobility: “Amped-up R&D funding can lead to lighter, safer batteries being manufactured in India. Thus, lowering operating costs for logistics fleets, while extending kilometre range and boosting performance. Finally, we urge for a clear, stable policy framework, including a program incentivising the replacement of polluting vehicles with electric alternatives, accelerating sustainable transportation adoption and providing a predictable environment for long-term planning and investment in fleets. With these measures, we can work with the government to curb carbon emissions and ignite robust economic growth, powered by safe, smart and sustainable logistics solutions.”

Primary expectation for the upcoming 2024 budget revolves around tackling the credit challenges confronted by Small and Medium Enterprises (SMEs), says Manick Wadhwa, Director at SKI Capital. Acknowledging the crucial role of credit in SME expansion, he says there is an anticipation for the implementation of initiatives that streamline government-backed loans and alleviate funding obstacles. Furthermore, the hope is to encourage Non-Banking Financial Companies (NBFCs) to broaden their lending scope to SMEs, promising a more dynamic and diversified financial landscape for these enterprises.

Read More Here: ‘Budget 2024 expected to propel SME IPO market to new heights’

Proposing a significant transformation in the nation’s economic framework, the Confederation of Indian Industry (CII) has suggested the creation of an all-encompassing Ministry of Investment in the interim budget, ANI reported. Conceived as a centralized hub, this envisioned ministry aims to simplify and expedite investment prospects both domestically and internationally for Indian investors.

Rohit Gera, the Managing Director of Gera Developments, a leading player in the real estate industry and the acclaimed developer of high-end residential and commercial projects in Pune, Goa, Bengaluru, and California, shared his perspective with ANI on the upcoming union budget. Gera expressed that the real estate sector is experiencing positive growth after several years, leading to increased affordability and larger home purchases by consumers. To further stimulate the market, he said the government should consider incentivizing first-time homebuyers and offering supply-side benefits to developers focused on affordable housing, ultimately addressing the needs of the first-time homebuyer segment.

The government is poised to significantly augment allocations for crucial agricultural sector schemes and promote credit in the interim Budget to bolster the rural economy, a PTI report said. This initiative comes in response to the projected slowdown in agricultural sector growth to 1.8 percent in 2023-24, down from 4 percent the previous year. Finance Minister Nirmala Sitharaman is set to present the interim Budget on February 1, marking the final major economic document before the 2024 Lok Sabha elections under the leadership of Prime Minister Narendra Modi.

Furthermore, the government is likely to announce a substantial rise in the agricultural credit target, ranging between Rs 22-25 lakh crore for the next fiscal year, ensuring broader access to institutional credit for every eligible farmer, reported PTI. The current fiscal year’s agricultural credit target stands at Rs 20 lakh crore.

On Wednesday, the Apparel Export Promotion Council called for tax incentives, including the harmonization of GST rates and increased interest subsidies, to promote domestic manufacturing and augment India‘s outbound shipments, reported PTI. AEPC specifically urged for tax concessions to be extended to apparel manufacturers embracing Environmental, Social, and Corporate Governance practices and adhering to international quality standards and compliances. Additionally, the council sought budgetary support to enhance the branding and marketing of products made in India, considering the upcoming Budget presentation scheduled for February 1.

The council highlighted a revision in interest equalization rates, noting a decrease from 3 to 2 percent for non-MSME manufacturer exporters participating in the interest equalization scheme for pre-and post-shipment export credit.

“Anticipating the upcoming budget, the MDF industry looks forward to a strategic allocation of funds for infrastructure, sustainability, and innovation. Acknowledging the import-cost disparity of around 25% is crucial, and bridging this gap is a pre-budget expectation to alleviate the burden on Indian MDF manufacturers. Addressing logistics, promoting exports, and ensuring fair customs duties, alongside measures to mitigate the impact of the 25% cost disparity in imports, will create a holistic environment. This approach will nurture a resilient MDF sector, fostering sustainable development and global competitiveness,” says Sunil Singh, CSO, MDF and Flooring of Greenpanel Industries Ltd.

Balasubramanian A, Vice President, TeamLease Services says that the travel and hospitality sector expects this fiscal year’s budget to:

Promote domestic tourism: Initiatives like “Swadesh Darshan” and infrastructure development at tourist destinations can increase domestic tourism, potentially impacting the sector by Rs. 10,000-15,000 crores. This could lead to significant job creation in hotels, restaurants, transportation, and other tourism-related services.

Relaxation of visa norms for foreign tourists: Simplified visa processes and targeted marketing campaigns can attract more foreign tourists, potentially doubling tourist arrivals within 5 years. This could create several lakh jobs across the travel and hospitality industry.

Support for MSMEs in the hospitality sector: Financial assistance and skill development programs for small and medium-sized hotels and restaurants can boost their competitiveness and create jobs.

Focus on sustainable tourism: Promoting eco-friendly practices and responsible tourism can attract conscious travelers and improve the long-term sustainability of the sector, potentially leading to new job opportunities in eco-tourism and related fields.

With the anticipation mounting for the upcoming 2024 budget, leaders in the industry are hopeful regarding the Indian government’s steadfast dedication to economic resilience and innovation. Pavan Ranga, Managing Director of Rangsons Aerospace, is optimistic about the foundation established by previous budgets and eagerly anticipates ongoing support for vital business sectors, especially defense and aerospace. The past two years have seen significant advancements in aerospace engineering and manufacturing, prompting a strong appeal for a substantial budget increase in 2024.

Read More Here: Optimism and expectations in India’s aerospace and defence industry