Union Budget 2022: Expectations from Various Industry Leaders Defined

On 1 February 2022, Finance Minister Nirmala Sitharaman will be presenting the Budget for the financial year 2022-23. 

At Apeksha Sandesh, we spoke to few leaders from various industries. Here is what they look forward to in the Union Budget 2022.

Dr. Srikanth Sola, Director, CEO and Co-founder, Devic Earth: India has 9 out of the 10 most polluted cities in the world. But our country has only 800 or so air quality monitoring stations, almost all of which are in the cities. We hope that the Finance Minister will address this critical issue in the Union Budget. Monitoring and Measurement is key and first step towards improvement. India’s projected need is 1,600 to 4,000 air quality monitoring stations spread across tier I-III cities and rural areas. These will enable data driven policies to create tangible improvements in air quality in the shortest possible time. We also expect the government to facilitate conducive policy initiatives like single window clearance to promote technologies and initiatives to combat air pollution menace and provide the citizen clean and healthy air to breath.

Ramanujam Komanduri, Country Manager, India, Pure Storage: With restrictions in place amidst the third wave of Covid, large enterprises as well as small businesses are seeing a dip in their business activities. Both corporates and taxpayers expect relief in the form of rebates in direct and indirect taxes in the upcoming budget. We also expect the introduction of simplified compliances to facilitate the ease of doing business. The Finance Ministry could also introduce special stimulus packages to the MSME sector which is vital for economic revival. There may also be a positive surprise in the form of a relaxation of GST regulation and relief for sectors that have particularly suffered during the pandemic. The Government, to provide further impetus to business growth, could also introduce fiscal policy initiatives to build a strong digital infrastructure for MSMEs and enterprises. While India has one of the most dynamic technology ecosystems globally, we hope that the government will reaffirm its commitment to ‘Digital India’ through appropriate allocations and policies in this Union budget.

Vipul Singh, Founder & CEO of Aarav Unmanned Systems (AUS): In this Union Budget, we expect the government to promote the start-up ecosystem in the country and announce steps that will ease raising funds and create a favourable environment to conduct business. With Covid 19 pandemic, we have witnessed an accelerated process of digital transformation. We cannot deny that the pandemic has pushed people and businesses to adopt new ways to do things and reorient their behaviours. The government's announcing the Drone Rules 2021 and PLI scheme for the drone industry has given a push to this industry. Many drone companies in India have signed new deals to start large-scale, commercial business-to-business (B2B) drone operations in 2022. With this budget, we will expect the government to simplify policies, create a strong credit system for MSMEs and provide better working capital support that would help drone companies to scale up manufacturing and leverage the production-linked incentive (PLI) scheme. We will also witness employment opportunities which we believe are important for revival in demand post covid era.

Farrokh Cooper, Chairman & Managing Director, Cooper Corporation: The forthcoming Union Budget for 2022 should emphasise measures to help the Indian economy recover from the pandemic and to boost consumption-led demand. The auto industry expects relief from the Union Budget in multiple areas. To achieve sustainable growth, business communities should be encouraged to invest more in industry and businesses. I believe that the government should fix industry income rates for at least five years so that industrialists can make long-term financial planning and take appropriate decisions about investment in their industries. Furthermore, the government is now encouraging businesses to establish large industries, and they should be treated equally with medium and small industries in terms of receiving timely payments from the government and private sectors so that they can pay small and medium enterprises. Furthermore, the government should priorities managing inflation and lowering the cost of raw materials and fuel. To boost exports, existing incentives must be increased. There is also a need to accelerate the GST refund procedure to provide liquidity to the industries. The industry is also eagerly awaiting news on the scrappage policy. Given the current market conditions, we anticipate significant initiatives to revive growth and boost investor confidence in the upcoming Union Budget.

Anurag Garg, Managing Director & Country Head, Vitesco Technologies, India: The Union Budget 2022 was the most anticipated budget for the Indian automotive and manufacturing sector. There was a strong push towards manufacturing and localization in this budget. Apart from the usual focus on fiscal deficit, this time the government has shown a great focus on health and infrastructure development this time. To take the overall automotive industry and retail trade back on the path of growth, the Ministry should regulate and reduce GST rates on two-wheelers to 18%. It is important to note that the two-wheeler is a necessity to travel distances by lower class and rural segments for their daily working needs. The market is very volatile, and the automobile prices are increasing every 3-4 months due to incessant price hikes in metals and various other issues, a reduction in GST rate will counter the price hike and aid in shooting up the demands in the market. We are further awaiting more light on production-linked incentive (PLI) schemes extended for electric vehicles and advanced technology components, the vehicle scrappage policy, and announcements of PLI scheme for semiconductors are major positive steps. These have the potential to boost demand and resolve supply chain disruptions for the industry. The PLI Scheme will get a better push to boost manufacturing and attract investments in the automotive sector, benefitting us in the long run. The increase in custom duties on some sectors is designed to push self-reliance and localization. As we look towards a future with electrified automotive, localization will definitely help in cost optimization in the future. Though it might create initial challenges through price hikes and demand generation, it will be better for our economy in long run. Additionally, the focus on renewable energy is welcome. The Hydrogen Energy Mission and focus on solar energy will help meet our energy requirements in the future adequately. Health outlay in the budget has increased by almost 100% considering the pandemic situation, this will help us to uplift the health infrastructure in both urban and rural segments of our country.

Yash Jinendra Munot, Vice President, AIFI (Association of Indian Forging Industry): This year, there are expectations of a good, progressive, and balanced budget from all MSME’s, including the forging industry, due to the rough patches the industry has seen with current chip shortages and the pandemic and keeping in mind that the industry has not fully recovered with the heavy investment done for BS-VI implementation. As the industry faces a large cash flow block with some value-added products at 28%, this budget should consider rationalisation of the GST rates, which should be uniform at 18%. Additionally, import duties on steel should be reduced to meet the current shortfall and competitive Indian steel prices.  Furthermore, as part of the 'Make in India' initiative, Indian companies should be eligible for a benefit on the Duty structure. The government has made continuous efforts to simplify and streamline Indian tax laws, and the industry anticipates consistency in tax and regulatory policies, as well as their interpretation, this year. To achieve Industry 4.0, funds should be allocated through FDI schemes and new investment allowances to encourage investment in technology. We also anticipate that the scrappage policy, which is currently being held up by the finance ministry, will be passed to boost demand in all segments of the auto sector while achieving pollution goals. Thus, incentives for scrapping old and purchase of new vehicles should be implemented quickly.

Ashwath Ram, Managing Director, Cummins India Limited: India must continue its multi-year spend on infrastructure to sustain growth. We cannot slow down spend even if it is slightly inflationary in the short term. More support is needed for Manufacturing as we are still reeling under the effects of Covid-19 to sustain long term growth and capital buildup. Liquidity is important for manufacturers to get capital at cheaper rates to invest in equipment for growth. Exporters need to be encouraged by SEZs coming into Remission of Duties and Taxes on Exported Products (RoDTEP) and the rates of payouts from the schemes to match the actual double taxations costs. Manufacturing of electrolyzers for H2, H2 in ICE and Flex fuels engines production equipment should come under the PLI scheme. Further, exports focused projects in Manufacturing need some incentives for better scalability and business sustainability.

Sushanth Pai, Chief Financial Officer, Matrimony.com: Some sectors such as travel and hospitality have been heavily impacted due to the current situation. The budget should focus on support to revive such sectors. A study of all the policy reforms needs to be undertaken with greater intensity to see how they can be implemented effectively and with speed, so that the basic ecosystem of well-being can be boosted.

Alok Dubey, CFO, Acer India: We are hoping this Budget, the government announces steps to revitalize and reorganise the economy which has been impacted by the pandemic. This can be a positive start to encourage sustainable growth and push Digital Infrastructure- 5G, edge computing, and secured data management in India. The comprehensive program for the “development of sustainable semiconductor and display ecosystem in the country” will be a boost in making India a global hub of electronic system design and manufacturing but we would like to see reforms that will drive consumption and improve consumer demand. We are optimistic about the upcoming budget and expect it to usher in a balanced combination of reforms and regulations which will, in turn, boost Digital India, contributing positively to India’s growth story.

Alok Khullar, CEO, Gleneagles Global Health City, Chennai: The outbreak of Covid-19 has taught the healthcare sector some important lessons. The healthcare sector has and will continue to play a crucial role in saving lives, treating other ailments while tackling the pandemic. With the disruption caused to the healthcare sector during this period, we urge the government to give adequate importance to the healthcare sector in the upcoming Union Budget 2022 by considering –

• Special schemes that should be provided for formal training of doctors and nurses to enhance skills and bandwidth to offer care to a larger population which will help strengthen the quality of healthcare resources in the longer run
• Building capacity for Intensive Care by enhancing skills of nurses and by providing better equipment and infrastructure
• Significance to be given to Appropriate Screening for Non-Communicable Diseases to ensure timely diagnosis and treatment which will help in reduction of hospitalisation in the last minute
• Upgrading infrastructure at Primary Health Care level for early Outpatient treatment thus reducing Hospitalization time and cost
• Benefits to be given to manufacturers of Healthcare equipment & consumables under the ‘Make in India’ campaign for high quality products and healthcare equipment to be manufactured at reasonable costs
• Healthcare organisations must be given access to working capital and preferential funding to ensure that the overall cost of operations is reduced

Healthcare sector needs to be considered as a priority and an essential service. Various subsidies and benefits should be given on land rates and other necessities such as electricity, as it will pave for accessible and affordable healthcare with better infrastructure and high quality treatment improving access to care and better patient outcomes.

Nishanth Chandran, Founder & CEO, TenderCuts: The $ 40 billion meat industry is growing at a rapid pace with the introduction of several schemes by the Central government aiding the livestock sector in 2021. The Government assistance in providing cold storage facilities through credit linked back-ended subsidies available at the rate of 35% of the project cost in general areas and 50% in hilly and scheduled areas has paved way for entrepreneurship. To continue with the momentum, the government should also work towards attracting investments offering more subsidies on electricity tariffs to develop perishable logistics infrastructure, which is another route that can be explored.

G. Srinivasan, CEO, Athulya: The changing dynamics of the healthcare industry post the outbreak of Covid-19 has elucidated the need for enhancing the skills of existing healthcare workers to facilitate better service. Hence, initiatives to motivate youngsters to take up a career in the healthcare industry and to include continuous development programs in their curriculum to enhance their skills will address the current demand for healthcare professionals.

To help our senior citizens meet the rising cost of medical treatments we would request to increase the health insurance age limit for senior citizens and to include provisions to increase the coverage, irrespective of existing medical illnesses.

To increase the support and guidance given to start-ups, in the form of incentives towards building and developing healthcare technologies that would aid in early detection, monitoring, screening and diagnosis of health ailments. This will reduce our dependence on international companies for the same.

We would also expect the government to considerately reduce the taxes imposed on medical equipment that are very essential, which will result in bringing down the overall medical expenses for an individual with ailments and comorbidities. Eventually, helping our senior citizen community to fight the potential escalations in their medical bills.

And finally, to increase the tax benefits against their medical expenses and to revise the existing deduction for senior citizens as the cost of living has increased.

C.J. Vetrievel - Founder Chairman & Managing Director, Be Well Hospitals, Chennai: The excellent leadership and dedication shown by the Central Government while handling the pandemic is commendable and must take inspiration from the same. With the country battling the third wave of Covid-19, there is a huge gap in the healthcare system that needs to be addressed by various healthcare service providers to form a network. An effective public-private partnership (PPP) model should be proposed to ensure cost efficient operations are conducted. Additionally, the capital expenditure incurred on eligible healthcare projects in semi-urban and rural areas should be reduced for ventures with minimum 50 beds. This will help in reaching rural, semi-urban, peri-urban and suburban regions of the state by having a distributed healthcare delivery model rather than crowding in cities whilst providing quality healthcare services in the above said regions. Considering the shortage of medical manpower in the country, a weighted deduction of expenses incurred on skill development in the healthcare sector must be offered.

Input credit on various services availed is currently very high resulting in high cost of treatment which is borne by the patient. GST on rental property is not eligible for input credit making it a cost for the hospital. Alternatively, hospitals should also be given the ability to claim the refund of input credits, similar to the benefits availed by Export Oriented Units and Special Economic Zones. This will help in reducing the cost of rendering services to patients.

Healthcare sector needs to be considered as a priority and an essential service. Loans for working capital should also be provided to new borrowers under the Emergency Credit Line Guarantee Scheme (ECLGS). These are some considerations that we are requesting from the Government in the upcoming Union Budget 2022.

Aakash Chaudhry, Managing Director, Aakash Educational Services Limited (AESL): With the Union Budget 2022-23 approaching, the young generation has high expectations from the Government especially in four segments – Education & Skill Development, better infrastructure, enhanced employment opportunities and common man's safety & security. We applaud the Government initiatives like the adoption of the NEP, inclusion of new-age courses, and strengthening of the e-learning ecosystem. With Covid completely changing the dynamics of classroom education, we expect there to be a great amount of focus on online education and its infrastructure, especially in the Tier 2,3 cities, in the Budget.

Covid-19 adversely impacted the education system and forced an increase in the rate of school dropouts. The government should announce an attractive stimulus package and provisions for the education industry to bridge the glaring gap between urban and rural populations. The Government also needs to support telecom companies so that they develop better infrastructure, internet connectivity, access to modern devices, ensuring last-mile delivery, quality guidance to the underserved who have been left behind owing to the digital divide. While skilling, reskilling and upskilling will be the new normal, we need to develop more institutes like IITs, IIMs. NIIT, association with foreign universities offering new-age curriculum in sync with global standards to propel future workforce to be industry-ready. The Government should focus on major fund allocation towards innovation, research and development to help talent create lucrative employment opportunities.

Dr, Silpi Sahoo, Chairperson, SAI International Education Group: The progress of a nation depends on the educated youth. We hope our Government shift their focus on the education sector with a vision that not a single child is deprived of quality education. We expect to see an increase in the allocation of annual budget for education from 6% as done in 2021 which amount a total allocation of Rs. 93,223 crores, against Rs. 99,311 crores in the year before that. We are hoping for an increase of allocation of the annual education budget to 10%.

Currently, the GST rate which is applied on education is categorized under Education Services and hence 18% GST is levied, we expect the Government to revise the GST rate and reduce it to 5%. The pandemic has severely impacted the learning process and students are looking at the other supplementary sources, hence, reducing the GST will ease the pressure of the parents especially those from lower or middle class and learning will be made affordable for all the sections of the society.

Over 200 million children lost a complete year of formal education due to the lack of proper digital infrastructure and unequipped teachers as Schools were shut across the country. Online education needed a dynamic digital infrastructure but due to lack of funds the schools could not impart education.  Education should reach each corner and the remotest of areas of India. The pandemic showed a mirror that we need to have a robust and improved digital infrastructure to reduce the digital divide of rural and urban.

Dr Alok Roy, Chair, FICCI Health Services Committee and Chairman, Medica Group of Hospitals: COVID 19 has highlighted the significance of a robust healthcare system in the country and proved that you are only as strong as your healthcare systems. The healthcare sector, ravaged by an ongoing pandemic, demands increased outlays in healthcare expenditure, investment in research & innovation, and funds for the development of  suitable resources to strengthen the monitoring system of the public health system as a whole.

Union Budget 2022-23 has to be a forward looking budget as we are battling with a two year old plus pandemic affecting lives and livelihoods. This year’s Budget shall redefine India as it makes steps to emerge out from the crisis towards a path of sustainable growth.

The Centre’s Budgetary allocation to the healthcare sector should be increased to at least 2.5 per cent of the GDP to bridge several gaps that currently exist in the system. Further, tech driven-innovative healthcare solutions have played a pivotal role in fighting mankind’s biggest health crisis and healthcare providers have embraced these solutions to solve for accessibility. This year’s budget should focus on encouraging these solutions by way of tax benefits/ tax holidays and even establishing a healthcare innovation fund.

Though all our focus is on the COVID-19 pandemic at the moment, it is critical to increase spending on preventive healthcare and wellness. Ayushman Bharat is undeniably a positive step toward achieving the goal of universal healthcare; however, more funding is required to ensure its long-term success.

Healthcare funding through subsidized loans specially in Tier II & III cities need to be provided for as this shall help to reactivate the healthcare infrastructure sector which will further boost other supporting industries.

Identifying areas of for PPP models and a robust framework for PPP could help boost private sector investment, augment public capacity while improving efficiency. Government must accord due importance to operational viability gap funding, over &b above the capital VGF. This aspect is missing and that’s why most of the hospitals are unable to utilise the capital funding options provided by the banks.

This pandemic has also necessitated  for a more self-reliant India, ---Atmanirbhar Bharat’. For Indian MedTech sector to be viable & sustaining, there has to be a waiver off the duty and CESS, releasing sectoral payment dues, to free up the working capital for investments in critical spare and lifesaving equipment. There is a huge scope for the medical device industry to flourish. Currently, India is among top 20 markets for medical devices globally. The market is expected to reach $50 billion in 2025. However, India currently imports 80 per cent of medical devices requirements. More emphasis should be placed in creating a commensurate ecosystem which will drive manufacturing within the country. More medical device parks like IT parks need to be built.

Reduction in GST and import duties is top on the agenda and Government must explore to simplify the FDI in healthcare sector. A mandatory/tax-incentivized health saving plan/scheme from early ages, private health insurance reforms to increase enrolment, and provide comprehensive cover for all the aspects of senior care.

We have seen in these last two years how the pandemic is resurfacing with different variants. This calls for a budget specifically dedicated for Covid19’s Research & Development (R&D) which will also guides the country in case of any such future pandemics. We are hopeful that this year’s budget will show us the way on sustaining the economy to an 8 percent plus growth path after the slump of the pandemic.

Dr. Mona Lisa Bal, Chairperson, KiiT International School: The year 2022 has started with a fresh wave of the pandemic that has further shook the backbone of our education system. The learning loss created by the pandemic needs immediate addressal in the Union Budget 2022. The existing digital divide in the country is no longer a new information. According to UNESCO’s state Education Report 2021, the availability of computing equipment in schools in India has been found to be only 22% and only 19% out of them have an internet facility. The development of digital infrastructure did not receive due consideration in last year’s budget and hence, it is imperative to allocate sufficient funds for the development of a robust and improved digital infrastructure. With physical classes being shut once again, students will be dependent on online classes to continue learning. We must ensure that no student in the country is left behind owing to financial and technological disadvantage. The end of the pandemic is nowhere in sight; therefore, it is essential that we take measures to guarantee that education is not put on hold. The unpredictable nature of our present has made it clear that we need to safeguard our future. It is important that we adapt our education system, pedagogies, and assessments accordingly. Upskilling of teachers is therefore more important than ever now. The economic implication of the pandemic has been adverse, and many have lost their livelihood or have lowered income. Reduction of interest rates on education loans is also required so that students aspiring for higher education are not financially burdened. Implementation of NEP 2020 has been slow, and the upcoming budget also needs to focus on this. Budgetary allocations need to be made for faster implementation of NEP 2020 which has the potential to change our education system for the better. 6 - 10% of the GDP should be allocated towards education. This would lead to a healthy start in the further progress to build a stronger foundation. Opening FDI into education would be helpful in further expansion of technological advancements.

Lalit Beriwala, Director, Shyam Steel Industries Ltd.: India’s micro, small and medium enterprises is second in number only to China. MSMEs are integral to our economy contributing 30% to the country’s GDP, 50% to the export and employment generation of over 100 million, next only to the Agri sector. Their contribution towards delivering social justice for containing regional disparities and equitable economic growth are no less important factors for the Government to take note of.

Improved performance of MSME sector is vital for achieving global benchmark efficiency and quality of products being manufactured in India, as it supplies goods and services to big industrial enterprises. The Government, therefore, should invest in providing backend services to improve performance of MSMEs. Lack of technology-based production and low investment in research and development are bottlenecks for the sector to become globally competent. Government could subsidise internationally available technology for adoption by MSME players to improve their product quality, utilizing their existing resources. Hand holding by designated academic institutes of repute in the same geographical territory for product innovation can also support their cause. 

For a more equitable distribution of national resources, policy support to MSMEs also can help unleash their potential. For example, if the Government decide to roll out PLI schemes exclusively meant for MSMEs, it can provide them with a coverage against fierce competition with the bigger business houses to stake claims on incentives for improved performance.

Growth of Indian steel industry has been driven by domestic availability of raw materials such as iron ore and coal. Consequently, steel sector has been a major contributor to India’s manufacturing output. For MSMEs to play a bigger role, Government may consider allocation of smaller mines of Iron Ore and Coal through the e-auction process amongst MSMEs alone, which will protect them from the competition with the bigger businesses.

MSME sector, therefore, look forward to an enabling ecosystem provided by the Government in the manufacturing and steel industry domain, with budgetary and policy support, to emerge as an equal partner in making India self-reliant and transcending it to a $5tn economy.

Nikhil Mathur, Managing Director - India: In the coming Union Budget session, the industry is expecting an increased focus on energy-efficient products with reduced GST tax slabs and added incentives. Some reforms that is likely to boost manufacturing include reduction of corporate tax, expansion on Production Linked Incentives, rationalization of tax rates on products like Air conditioners, televisions, etc. The government’s commitment to make India a global manufacturing hub and ‘AtmaNirbhar’ with ‘Make in India’ vision will potentially help in increasing penetration and expansion of tech & durables market.

Prof (Dr.) Y.S.R. Murthy, Founding Vice-Chancellor, RV University, Bengaluru: With the current pandemic situation, it is crucial to prioritise education and health in India. Despite many promises, the allocation for education had never touched 6% of GDP in India. But the government should focus on the needs of the education sector in general, and higher education in particular. As two-thirds of the higher education sector is in the hands of the private sector, it is time to encourage private corporate philanthropy in a big way through fiscal and other incentives. We also need to create an enabling environment to let the private sector come forward and establish new institutions. Contributions made by a corporate or a foundation or any other grant-making entity to a University or to a research center or a center of excellence (being part of a university or higher education institution) or a new university approved by the government or an approved program under a university-industry partnership, should be eligible for deduction from taxable income to the extent of 300% of such contribution. 

Higher education institutions should be incentivized to build significant endowments. We would want the government to set up a scholarship to be named 'The Indian Corporate Higher Education Scholarship’ with a corpus of Rs.1,000 crores contributed by the top 1000 corporations of the country. This should be run by an eminent independent board. This scheme should be encouraged by the government by providing full matching grants as well as providing tax exemption of up to 300% for all contributions.

Neeraj Dhawan, Managing Director, Experian India: 

• Measures for SME lending to accelerate and succeed: Helping MSMEs build a good credit line and a credit history is the need of the hour. A good credit line will help them with quick and easy access to secured credit, also assuring the lenders such as banks on the risk they will be underwriting. For this purpose, providing Credit Bureaus with access to utilities bills data, cash flows and invoices data, income tax data, and GST and expanding the scope of the Bureau data to include alternate data will be effective steps to scale up credit access to MSMEs. Mandating Permanent Account Number (PAN) for all commercial reporting to Credit Bureaus is a necessary step helping build credit history that the government could consider bringing to effect.
• Allow deduction for expenditure of covid treatment who do not have health insurance: The government should provide tax relief to the people who are paying for medical treatment of Covid-19 on their own. Extended tax relief should be provided for the expenditure on medical treatment of the covid affected to those who didn't have medical insurance. These individuals have carried the devastating financial impact of Covid-19 on their own.
• Optimizing tax slabs for the salaried taxpayer: The expectation of citizens from the upcoming budget remains high. The suggestion that is already in the circles for the government to consider increasing the annual tax deduction limit for repayment of home loan principal under Section 80C of the Income Tax act will be a good step forward. Increasing it from the current cap of INR 2 lakhs to 5 lakhs will provide huge benefits to the salaried taxpayer and at the same time boost the real estate industry with increase housing demand. Further adjusting tax slabs with the increase in other deductions can help the salaried taxpayer, specifically the below INR 50 lakhs per annum bracket with more money in hand.
• Measures for digital skilling and technology incubation: The digital payment industry is playing an influential role in ushering transparency and formalization of the economy. To further promote the industry by supporting new business deployment solutions the government could consider incentivizing Venture Capitalists and Private Equity players and other investors to fund Research & Development and technology infrastructure upgradation in India.
• Measures to propel and encourage fintechs that are serving the under-credited: A large population of India in the likes of the blue-collared workers, construction workers and house-helps who don’t fall under the formal employment segment are in need of access to credit. Helping this under-credited segment with access to unsecured loans provided by certain fintechs will provide a significant domino effect for the entire upliftment of the society and the economy at large. The government should consider providing incentives to these fintechs that are lending to the under-credited to encourage more fintechs to serve this segment and also effectively manage the risk being underwritten.  

Professor Vidya Mahambare, Professor, Chairperson, UB-GL Centre for Banking Excellence, Great Lakes Institute of Management: The Indian economic recovery is weak and uncertain. Among the four drivers of demand – private consumption, private investment, government demand and exports, the first two cannot be expected to drive the overall recovery in near future. This is because job creation and income generation have been uneven across the sectors with concentrated gains in exports led sectors such as Information technology and hopefully this will continue. The budget should focus on raising the capital spending in physical infrastructure and social sectors such as health, and education, which are also labour intensive, and to frontload it. This would create low-skilled jobs that were lost in sectors construction and would lead to an increase in demand for sectors such as cement, steel, and eventually crowd in private investment as capacity utilisation levels rise.

It is critical to create conditions for low-skilled jobs which may continue to suffer even after the current wave of Omicron is over if corporates continue with work from home policies. People working in the informal sector such as in transport, hotels & restaurants, and housekeeping have jobs when formal sector employees work from the office. If that is not the case, we have to find alternative jobs. While a high allocation to schemes such as NREGA may help, it can only be a temporary solution.

Continued fiscal support at this juncture is important given that monetary policy tightening is also expected to start globally and in India, in the face of rising inflation. This however, need not result in a higher fiscal deficit to GDP ratio given tax buoyancy from the formal sector.

Rajeev Agarwal - CEO & Founder, Innoviti Payment Solutions: 2022 is projected to be an exciting year for the Indian FinTech industry. Timely and targeted policy initiatives last year gave this sector the much-required boost paving the road for tremendous innovation. I anticipate that the Union Budget 2022 will play a supporting and helpful role.

Some initiatives that can support this momentum include allowing credit on UPI, mandating transparent publishing of reliability rates of various bank UPI and card processing systems, permitting tokenization in offline payments, liberalizing the tax regime for small merchants by offering a reduction in GST for adopting to digital payments and expanding the digital infrastructure of the country to include transactions in the absence of real-time connectivity.

The formation of a dedicated FinTech division at the RBI is a positive move, and we look forward to the RBI not just encouraging FinTech innovations, but also identifying and addressing the challenges and opportunities that come with it.

Winny Patro - CEO & Co-founder, Recordent: The MSMEs have been hugely impacted by the COVID-19 pandemic induced lockdowns in the past two years. The government announced the ECGLS scheme to provide support during the initial lockdown days. The expectation from the Union Budget 2022-23 will be to further provide support to these small & medium businesses through policies that drive reduction in interest rates on loans and enhance loan procurement process to help walk on the road to recovery and subsequent business growth. Also, revisiting duties and taxes in sectors which can compete at international markets will lead to faster growth of MSMEs. Furthermore, to accelerate Atmanirbhar - Make-in-India and Made-for-India, government may re-visit and reduce the GST on capital goods to encourage small enterprises and businesses to invest more and produce more.

T Chitty Babu, Chairman and CEO, Akshaya Pvt. Ltd.: The upcoming budget should play a major role in the recovery of the economy in general and particularly the real estate sector. The real estate sector is the second-highest employment generator in India. The Budget 2021 benefitted the first-time homebuyers in the affordable segment due to the additional interest deduction on home loans, stamp duty cuts, low-interest rates on home loans among others.  We expect that the Union Budget will have customer friendly announcements, such as tax reliefs to homebuyers that will benefit the affordable housing segment and a single-window system to fast track approvals. This will accelerate the pace of investment in this space.  In the last two years, a slew of measures has been introduced in the real estate sector to boost consumer sentiment and provide relief to the developers. However special focus should be given to certain other aspects to facilitate the overall growth of the sector. Measures like uniformity in GST for different housing segments, ease of cash flow for better project executions, strengthening the banking infrastructure to aid the developers as well as the homebuyers - can pave for a sustained growth. Revision in income tax slabs can spur buyer sentiment which was marred by COVID-19. The government should also help address the issue of labour shortage as it will go a long way in providing the right impetus and boost private investments in the sector.

Ashok Rajpal, CEO & Founder, Ambrane India: The upcoming Budget 2022 would be critical in restoring India's pandemic hit MSME and the manufacturing sector. It is projected that the core topic of Budget 2022 would continue to offer stimulus to the market for locally created goods to minimize import reliance and support the 'Make in India' effort. 

To promote Make in India, the government must incentivize R&D by providing subsidies and fiscal stimulus to the private sector. The decrease of corporate taxes and the implementation of various PLI programmes in the Union Budget 2021 have boosted domestic manufacturing; nevertheless, the industry now requires an additional push with further Make in India plans and incentives for electronics manufacturers. PLI initiatives will be extended to attract greater private investment and engagement in the industry. The industrial business needs assistance in tax cuts and simpler legal procedures. Compliance should be simplified, and unnecessary legislation should be phased away. This will increase trust and confidence between the private sector and the government.

The forthcoming budget should prioritize employment too. Budget 2022 must focus on job creation via private and public sector engagement in areas with backward and forward economic integration. The budget should accelerate the implementation of the National Retail Trade Policy to streamline the licensing process, thereby making it seamless for growth. As export incentives have been reduced, trade policy must now encourage MSMEs to expand outside their boundaries. This would help India establish itself as a worldwide market leader. Reducing compliance and regulatory burden and providing financial incentives to large scale projects would also help bolster India's Industry 4.0 impetus. 

Rajendra Joshi, Executive Director, Alliance Group: With the Union Budget 2022 around the corner, from a real estate developer perspective, we are expecting this budget to have more sweeteners that would help boost foreign and local investment and the overall demand in the industry and thereby increase positivity in the sector. While the current tax rates at Rs 2 lakhs, we are expecting for a tax rebate to Rs 3 to 5 lakhs which in turn will enable many aspiring homebuyers to invest in their dream homes. The uncontrolled increase in cost of construction materials is another major concern in the industry as it directly impacts the property prices, and thereby affects home buying. Hence, more government interventions, and strict policies to control the cost of these materials will be a great relief to both developers as well as homebuyers. We are also expecting a few measures from the government in terms of lowering the input tax rates of construction raw materials to 5% from that of 28% for cement, 18% for iron and steel and 12% for Kiln.

Though the government has reduced GST rates on under-construction properties from 12% to 5%, we are expecting further reduction in GST rates and also help the developers’ community by offering input tax credits, giving the sector a much-needed breathing space without forcing developers to increase the property prices.  For a long time now, real estate developers have been demanding infrastructure status for the sector. While home buying is a primary industry, where close to about 250 industries are aligned with, the increase in home buying in the nation will certainly improve the economy of the country. Hence, infusion of liquidity and unlocking of capital into the industry is the one of the major supports that we developers are expecting in this Union budget 2022.  We are hopeful that the real estate sector will earn infrastructural status which will surely help build liquidity in the industry. Furthermore, we are also expecting an extension of the PMAY (Pradhan Mantri Awas Yojana)  scheme for the middle-income groups until the end of this year. While the housing loan interest rate has been brought down to almost 6 to 6.5%, maintaining the interest rates at the same level will be a great blessing for homebuyers as well as the developers.

The real estate industry is looking out for single-window clearances that will help in the quicker completion of residential projects. Despite the repel effect of the pandemic to continue in 2022, the rapid revival from the first two waves, industry has entered the new year with a positive note of surge in sales and demand, the union budget will act as an additional push to the industry. 

Kamal Khetan, CMD, Sunteck Realty Ltd.: We expect the wheels of reforms and the impetus to the real estate sector to accelerate the growth of the GDP further, with the vision, “Housing for All by 2022” being at the centre of this year’s Budget.

Enhancing the ambit of Affordable Housing: With regards to affordable housing, the Govt will have to revisit the nomenclature defining the segment to accommodate more people within metropolitan regions. Enhancing the cap (of Rs 45 lakhs) in metro cities to Rs 80 lakhs to Rs 1 crore will extend the benefit of affordable housing. Such a move would allow more buyers to avail of benefits like lower GST, Govt subsidies, and a tax deduction on interest repayment.

Other benefits: There is an expectation that the tax exemption on the interest would be hiked to Rs. 5 lakhs from the Rs 2 lakhs at present. There is also a need for deductions on home loan principal repayment as well as extending the loan repayment period to give more relief and inducement to buyers

To sustain the current growth momentum, the sector needs to be accorded the infrastructure status that would improve liquidity in the sector. We also expect the input tax GST credit for developers and a reduction in stamp duty and registration charges – as announced by a few states last fiscal – to continue. The Govt must make more announcements to enhance the ease of doing business for developers.

Taranjeet Singh Bhamra, CEO & Founder, AgNext Technologies: 2021 was a good year for the agritech sector, which flourished with strong investments and greater adoption of technologies in the market. To support this growth momentum, acute focus on the development of the burgeoning agritech ecosystem is pivotal. We hope that the upcoming budget will prioritize R&D incentivization in agriculture, along with the supportive impetus to allow agritech businesses, particularly start-ups, to scale domestically at a greater pace.

The emerging agritech ecosystem also requires a focus on infrastructure development and governance frameworks to spur more innovation in the sector. Fiscal considerations can be beneficial to facilitate the growth of the Indian agritech sector in 2022.

Rajamanohar Somasundaram, Founder & CEO, Aquaconnect: The PMMSY has shown some great results since its implementation. To accelerate the Blue Revolution 2.0, we expect a greater push to promote digital solutions across the value chain right from pre-production to post-harvest to bring predictability, efficiency, and traceability. Incentivizing farmers with better subsidies to adopt data-driven farming, farm monitoring & automation tools will eventually ease and accelerate the wider tech adoption and drive the transition of farmers towards modern farming systems with improved productivity. 

To achieve the PMMSY targets, the need of the hour is to drive the inclusion of formal finance and insurance in aquaculture. High insurance premiums demotivate the farmers from availing any risk mitigation for their crops, hence subsidizing insurance premiums will help fish and shrimp farmers to mitigate production risks and reduce production costs to a great extent. Further, increasing the fisheries KCC limit from the current range will help farmers meet their farming expenses entirely. 

Mr Amit Sinha, Co-Founder, Unnati: The Agriculture sector has seen significant progress over the years, primarily owing to technological advancements, although this can be improved further. In the upcoming 2022-2023 Union Budget, we expect the government to keep farmer upliftment, alongside rural growth and development as their topmost priority. An increase in investments of rural infrastructure, MSME development, digitization of the agri-ecosystem, and farmer productivity prioritization of Agritech to fund early-stage start-ups that are disrupting the agricultural economy also need to be focused on.

The Agritech industry will require support from the government in terms of tax benefits, eligibility criteria, etc., to boost the progress the sector is making and make agriculture a robust, tech-led sector. Some additional focus areas could be the allocation of funds for increased digitalization in the agricultural ecosystem, the promotion of collaboration between district governance and Agritech startups in order to bring innovative solutions to the farmers’ market, providing subsidies or cutbacks on taxes to farmers who opt for Agritech products. Easy access to capital, tax relaxation, and interest subvention to encourage FPO setups will allow the agritech industry to grow quickly and will help FPOs to gain traction in this new era.

Besides these, financial support to farmers, extensions to important government schemes like Pradhan Mantri Matsya Sampada Yojana, PM-Kisan Scheme, etc., are certain elements the government will need to turn their attention to. Overall, the sector has significant expectations from the government for this year’s Union Budget, and we hope that the concerns are addressed to make agriculture a technologically advanced sector and enhance farmers’ living standards.

Divay Kumar - CEO & Co-founder - O4S: The market is still in recovery mode with many MSMEs already shut or are on the verge of closing down in the near future. The unemployment rate is also expected to shoot up if businesses run out of cash to operate. As a matter of fact, MSMEs employs are a large chunk of the country’s population and simultaneously contribute 29% to the Gross Domestic Product (GDP). These facts very well highlight the vulnerabilities we could face, if necessary, measures are taken to revive the MSME sector.

We can expect the 2022 Union Budget to comprise more funds/schemes and initiatives that are focused on promoting technology and reviving the slowing economy. Startups who are considered to be the platform that could take the country to new horizons should be provided financial relief so that they can extend their runway for operations. Moreover, relaxations in GST, lending rates, and other regulations would support the ease of doing business in the country. With such reforms, businesses especially MSMEs could get the support of investors.

Technology-centric schemes should also be given a place in the budget as we are moving towards digitization. COVID-19 had taught us many lessons and it also made businesses of all sizes realize the importance of technology when it comes to business continuity.

P C Kandpal, MD & CEO, SBI General Insurance: The pandemic has been a catalyst in raising awareness around the need for health insurance, however India continues to remain under-penetrated insurance market. To bring a change in this scenario, we believe considering the ease on taxes and increasing the tax exemption under 80D especially on health insurance premium, can help boost a bit of penetration. Apart from impacting health insurance, considering the increasing natural catastrophes, we also anticipate that segments that are impacted by economic losses if are mandated to opt for fire and property insurance, it can reduce the burden of economic losses.

Parag Raja, MD & CEO, Bharti AXA Life Insurance: The ongoing pandemic has made Indians realise the importance of term insurance for the safety and security of their family. With the current level of under-penetration, the key task at hand is to make this significant financial protection tool more affordable for the masses and lucrative for taxpayers. We therefore propose to ease off the tax burden of 18% on term insurance policies and bring down the GST rate in the range of 2-5% to benefit end users.

For many years, life insurance is clubbed u/s 80C and the maximum tax benefit of Rs. 1,50,000 that an individual can avail gets divided with Pension Fund, NSC, PPF, SCSS, ELSS Mutual Funds, 5 years Bank FDs and Post Office Deposits. We propose a separate section under the income tax act which allows individuals to opt for an additional deduction over and above 80C for investing in a Life Insurance policy. With an increase in re-insurance premiums amidst the pandemic, there is also a need to provide enhanced deduction for insurance premium irrespective of the taxation regime opted by individuals/ HUF. This will reduce the social security burden of the Government.

Midhula Devabhaktuni, Co-founder and CMO, Mivi: Mivi has established itself as a truly Indian audio consumer brand with products that are designed, engineered and manufactured in India. Being the first brand to manufacture all of its audio products in India as well as one of the key companies in the consumer tech segment with indigenous manufacturing facilities, government support and its vision to promote home grown brands has helped us in many ways. In the upcoming budget, we are expecting the government to further extend its support to include wearables, hearables and home audio categories in the PLI scheme and SPECS capital subsidy scheme. These schemes will help Indian companies like Mivi and also encourage more and more brands to manufacture locally and decrease their dependency on imports.  Additionally, a phased manufacturing program should be introduced for these categories in order to produce more Make In India products.

Vikram Gidwani, Country Head, BioCatch: The Indian Banking and Fintech Industry is in the midst of a huge digital revolution and the regulators have done a great job in coming up with new regulations like Video KYC etc to aid this. But with digitisation comes a huge threat of increase in cyber crimes. In the upcoming budget, we are expecting the government to allocate a budget and invest for building the cybersecurity infrastructure of the country. Simultaneously, additional incentives or SOPs for the BFSI Sector (in terms of taxation or otherwise) can be proposed to further promote and fuel this digital transformation, while keeping the security and privacy of consumers at priority.

Amit Saraogi, Managing Director - Anmol Feeds: The year 2021 has been tough on all industries including the livestock and animal husbandry sector. Adding to this is the almost doubling of raw material prices like soya meal which is an important component in poultry and fish feed. This automatically pushes the price of finished products up and the farmers have to bear the brunt of it. Hence it is important to regulate the price of these raw materials and the upcoming budget must look into it. Moreover, import of genetically modified soya and maize must be allowed to bridge the demand supply gap that exists. The livestock sector currently contributes 25.6% to the Agricultural GDP and 4.11% to the National GDP and can grow further and contribute effectively towards nation building. For successful crop, it is important that the animals receive the right nutrition. The Government should look at bringing in policies so that a certain standard is maintained in feed production with approval from Ministry/ MSME / any other govt official for small scale feed manufactures – so that the quality and feed type can be monitored and maintained.  A minimum contract growing charge should also be fixed for the poultry sector so that farmers are not affected by the fluctuating market. Animal husbandry farmers do not enjoy the same advantage as crop farmers. It is high time that they reap the benefits of credit and insurance. NBFCs and other financial entities should start providing credit loans to animal husbandry farmers so that the sector can reach its full potential. Though the Government has rightly focused on the aquaculture and fisheries sector in previous budget, further attention and implementation of previous measures must be ensured. The budget for the Pradhan Mantri Matsya Sampada Yojna needs to be increased by 400% to reap the benefits of this sector properly. The aquaculture sector has tremendous ability to generate livelihood, especially for reverse migrants who have lost their jobs during the pandemic. Performance Linked Incentive scheme should be made applicable on manufacturing of floating fish feed and petfood as well. Government schemes like EPCG is a key enabler of international business to all business institutions which have a significant focus on the export market. However, there is a disparity in the system regarding export to Nepal & Bhutan which does not allow businesses to take advantage of this scheme. The Government must take note of this inconsistency and introduce remedial measures accordingly. Lastly, the Union Budget must encourage indigenous investment in infrastructural development like machines to produce feed and other technologies to take the sector ahead so that companies do not have to be dependent on importing such machines from foreign countries and make Bharat Atmanirbhar.

Jai Kishan Challa, CEO and Founder, Curated Living: The upcoming budget brings high hopes for the realty sector as well as rebates in taxes. We expect the budget will have a renewed focus on rental housing so that the current financial system can be strengthened to provide liquidity to the already stuck real estate projects. 

The government is expected to continue the promotion of affordable rental housing schemes followed by tax exemptions to notify rental housing products. It will further enhance the pace of investments in this scheme in order to achieve the ‘Housing for all’ mission.

Milind Gowardhan, MD and CEO at Leaf Fintech: We expect the government to keep focusing on the affordable housing segment as we saw demand for housing bounce back strongly after the first and second waves, driven mainly by historically low-interest rates on home loans. The cap of Rs 2 lakh per annum against interest rate deduction under section 24(b) of the Act needs to be hiked to at least Rs 5 lakh along with removing the Rs 45 lakh cap from affordable housing, which will boost the affordable and mid-segment housing in a big way.

Also, we expect the government to continue promoting the affordable rental housing schemes by announcing tax reliefs for rental housing projects, which will fast track the pace of investments in these schemes. The existing tax exemption on housing loans should be raised. The personal income tax could be made easier in terms of heads and filing in the budget.