Budget documents are not just numbers in fact scrutinizing them one can understand the intention of the government, its priorities, policies and the allocation of financial resources. It takes just a day to be presented in the parliament, while it takes several months to be prepared. The union budget referred to as the annual financial statement is the annual budget of the republic of India which is presented before the beginning of each financial year by the finance minister of India in parliament. The budget has to be passed before it can come into effect.
In 2021, the budget will be completely paperless for the first time in independent India in the wake of ongoing covid pandemics. It is going to be for the first time in the history of independent India that the 2021 budget is not going to be printed. The government will provide soft copies instead. With the Union Budget just around the corner, every sector, including the Indian startup ecosystem which is found to be the third-largest startup ecosystem of the world is counting down the days for the annual budget to be unveiled by Nirmala Sitharaman, the Finance Minister on February 1.
India now is settled on the 3rd spot globally, when it comes to startup generated economy, the government must contemplate introducing more tax benefits for startups. The entire country is holding back for the government to present the budget for the year 2021-22. Every industry and every sector is hoping for some changes in the economic infrastructure which will make the environment more conducive for conducting business, the startup sector is no different. The last decade has witnessed tremendous growth in the startup sector.
Expectations for the startups
The Founder & CEO, Vasitum Mr. Vikram Wadhawan says, “With the upcoming union budget, we are looking forward to the government’s decision to elevate the startup ecosystem including the MSMEs, which are going to be the biggest growth drivers of the economy. The major problematic areas for them was the availability of working capital. Thus, a framework which can mobilize funding for Startups and MSME will be a great initiative and will drive serious growth for both the sectors. Furthermore, we are anticipating the government to focus on extending credit facilities to MSMEs by re-leveling the banking and NBFCs to the same ground to ensure consumers get benefited. Additionally, we are also confident that an easy to maintain compliance agenda will provide the required impetus to various startups to stick to their homeland. Also having a hope that the government will introduce new policy incentives that will accelerate the business growth of startups & MSMEs; thereby helping them to expand, hire resources, generate employment opportunities and contribute to the GDP. In short, we feel a stronger and simpler framework for the Startups and credit / grants to the MSMEs should form a part of the Union Budget along with other usual announcements.” There has been rising expectations of relief packages for start-ups including possible purchase orders from the government, tax relief and swifter tax refunds, as recommended by industry bodies.
Agriculture
The government has been anticipated to focus on rural economy, agri-infrastructure and infrastructure spend in the upcoming budget though the overall allocations would be constrained by the limited available fiscal space. The lately announced production-linked incentive (PLI), the details of which are expected during CY2021, has the potential to kick-start significant investments in the automotive industry.
Tech
The consumer tech industry has great hope from the Union Budget 2021-22. There is a strong belief that the forthcoming budget has services that can give rise to developing initiatives such as ‘Make in India’, ‘Digital India’, and the ‘Smart Cities Mission’. In the upcoming budget, it is hopeful that the government would continue the good work it began carrying out in its first term with regards to GST, Make in India, along with organizing initiatives that have been taken in the consumer tech / FMCG sector. There has been an abolition of Chinese applications in India; this has led to considerable slowdown in import of Chinese products, so the industry is expecting improved funding and credit facility from the upcoming budget. Additionally, the expectations are still raging that the Government will continue to promote manufacturing in India through its ‘Make in India’ initiative as this would not only provide an uplift to Indian companies but also serve in creating more employment opportunities.
Manufacturing
The covid outbreak of the subsequent lockdown took a toll on the sector. According to data from the center for monitoring the India economy the manufacturing sector would stand to see the lowest investment since 2006, 2007. The government has already swung into action to give a renewed push to the manufacturing sector has announced the production linked incentive scheme for 10 sectors including automobile, pharm, telecom and network products can create a significant impact in boosting manufacturing in India.
Electronics manufacturing
The automotive sector is in the midst of one of the biggest technology transitions in India and the world. In sync with the Indian government’s “Make in India” vision and its aim to boost an export-led electronic manufacturing strategy at a global scale the Government has taken remarkable tread to allure large investments in mobile phone manufacturing and specified electronic components, including assembly, testing, marking and packaging units.
Health care
People have relied on video or telephone calls to talk to their medical professionals and doctors for discussing their medical issues telemedicine will continue to exist and expect that after covid 19, around 40-50 percent of their OPD will continue to be conducted through teleconsultation together with other innovations in the industry including AI, ML, Tele-mobile operator services, telemedicine will continue to exist and expect that in the post-pandemic era, around 40-50 percent of their OPD will continue to be conducted through teleconsultation together with other innovations in the industry including AI, ML, Tele-mobile operator services.
IT
The year 2021 promises to be a huge year for the sector fuelled by the growing need and adoption of digital technologies across the board. The sector has not only given rise to immense job opportunities but has also positioned India as one of the most preferred investment destinations globally. At present in the business sector, a strong push is expected towards policies promoting IT innovation by pushing business-critical and bold policy interventions to propel digital adoption across multiple industries. ‘Digital-first’ and ‘Data-centric’, should be the key focus areas for the Indian government in our view as we push for Digital innovation as an important building block for India’s future growth.
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