Budget 2024-25: How Industry Reacts

Union Finance Minister Nirmala Sitharaman presented the Interim Budget 2024-25 in parliament on Thursday. During her presentation, FM declared that the Indian economy has undergone a profound positive transformation over the last decade, stating, 'The Indian economy witnessed a profound positive transformation in the last 10 years.' Sitharaman has set the fiscal deficit target for 2024-25 at 5.1 per cent of the gross domestic product (GDP).

This budget is centered on key pillars such as 'Viksit Bharat by 2047,' people-centric inclusive development, garib kalyan (development for the poor), empowering the youth, welfare of farmers (annadata), nari shakti, strategy for Amrit kaal, achievements of taxation reforms, allocation to major schemes and more.

Here is how the industry is reacting to the vote-on-account budget."The Indian economy witnessed a profound positive transformation in the last 10 years," said Sitharaman. She has set the fiscal deficit target for 2024-25 at 5.1 per cent of gross domestic product (GDP).

Post Budget input By- S Ravi, Founder, Ravi Rajan & Co.
This budget is on the expected lines because it's a vote on account budget. There are no changes in the direct and indirect taxation which is on the expected lines. This budget focuses on what the government has achieved in the last 10 years and also the way forward in terms of economic growth. The focus is on “Viksit Bharat 2047” which talks about clean energy. A significant announcement is the free 300-unit rooftop solar power scheme, a positive step to encourage clean energy adoption. Additionally, increased allocations are made to the farm sector, farmers, and infrastructure development. So, overall, this budget prioritizes infrastructure and rural development, laying a strong foundation for the future.

Pralay Mondal, MD & CEO of CSB Bank 
The budget is fully aligned to vision 2047 with GDP defined as Governance , Development & Performance on the principle of reform, perform and transform. The path to fiscal consolidation with fiscal deficit pegged at 5.1% shows government commitment to its promises . Overall a fascinating budget covering all sections of society especially towards the research and innovation initiatives by our youth.

Manish Gunwani, Head – Equity, Bandhan AMC 
It is a fiscally prudent budget with conservative assumptions on tax revenues, nominal GDP etc. A big positive is the potential for interest rates to go down given the higher-than-expected drop in fiscal deficit. Overall we believe it enhances the macro stability of the economy.

Moin Ladha, Partner, Khaitan & Co
India’s entry into the Kartavya Kal has been announced with the India Middle East-Europe trade corridor which supports India’s unfettered commitment to national development and ambitious vision to transform into a developed nation by the centenary of its independence in 2047. This corridor is expected to positively impact and facilitate world trade and India’s trade in GCC region.

Keeping up with the promise of First Developed India (FDI), the 2024 Union Budget has prioritized strengthening and aiding the MSME sector to compete in the global market by meeting their investment needs, improving/ advancing the technology and liberalizing the regulatory space. With India being the hub of global trade, empowering small and medium businesses to compete in the global market was a much-awaited move.

Falguni Nayar, Founder and CEO, Nykaa
The establishment of a corpus of Rupees One Lakh Crore for our tech-savvy youth will usher an era of innovation. With thousands of technology startups in India, responsible for creating numerous jobs in the last decade, this financial boost will also propel research and development. This could catalyze significant advancements in the technology sector while unlocking the unique potential of our demographic dividend. 

In a strategic step towards nurturing the entrepreneurial essence of MSMEs, the budget announcements are poised to create an enabling environment for their growth. By providing necessary financial and training support, this initiative empowers homegrown entrepreneurs to not only thrive in India's dynamic business landscape but also position them for global competitiveness.

Aniruddha Naha, CIO – Alternates, PGIM India Asset Management
The government has stuck to the path of fiscal prudence and it was a welcome surprise to see the fiscal deficit revised estimates to be at 5.8 per cent and a glide path towards 5.1 per cent and 4.5 per cent over the next two years. Also, growth in tax assumptions is below 12 per cent, which is conservative and gives the government reasonable elbow room to continue its investment oriented growth plans.

V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services
The hallmark of this interim Budget is its fiscal rectitude. The fact that the Government has prioritised fiscal consolidation over populism on the eve of general elections is commendable. The fiscal deficit numbers of 5.8 per cent in the revised estimates for FY24 and 5.1 per cent for FY25 are better than the most optimistic expectations. This is very good news for the economy and consequently for the market. The boost to housing is another important proposal from the market perspective since this will benefit industries like cement, steel and all construction related segments.

Swapnil Shah, Director-Research, StoxBox
As expected, the interim budget did not usher any surprises with no myopic measures announced. The government continued with its focus on infrastructure and increased the capex outlay by 11 per cent covering railways, ports and aviation sectors. The government has walked the tight rope and followed a further fiscal consolidation path by promising to manage its finances well for FY25. The government did not bow down to the populist measures in the election year and kept the tax regime unchanged. Our overall reading is that the government has shown prudence in managing the various facets of economy and remains committed to the long-term vision of making India a developed economy by 2047.

Rajesh Narain Gupta, Managing Partner of SNG & Partners
Huge incentives to the private sector for innovations by creating a new fund exceeding one lakh crore and further a deep focus on infrastructure development by increasing the overall provisions as well as steps being taken towards rural, women and farmers development are astounding steps which will accelerate India becoming a developed nation.

Amit Kothari, Chief Finance Officer, Propelld
After landmark changes in the tax regime in budget 2020-21, the increase in threshold limits for higher tax rates for individuals in budget 2024 is another significant reform by the Government. Increase disposal income for individuals will be fuelling growth in the economy. Allowance of exemptions for say employee contribution to PF and national pension scheme under new tax regime is beneficial move for individuals to move towards new regime and sunset the old regime. This will help take away the confusion between the two regimes and offer higher net cash for the individuals.

Rahul Mehta, Chief Mentor, Clothing Manufacturers Association of India
As an interim budget, it was anticipated that no significant announcements would be made, and indeed, there were no surprises. Nevertheless, the budget provided essential indicators of the anticipated direction for the July budget, emphasising key areas such as innovation, support for start-ups, sustainable development, job creation, and a dedicated focus on Women Empowerment and Domestic Manufacturing, aligning with the overarching theme of 'First Develop India.

Manoj Purohit, Partner & Leader, Financial Services, Tax & Regulatory Services, BDO India
Investment under the Foreign Direct Investment (FDI) route is growing year on year. With a view of providing further impetus to the foreign investment, the Indian government is negotiating bilateral treaties with various nations in the spirit of ‘first develop India’ to increase the investment inflows. This will not only create investment opportunities for the foreign investors, but also boost the Indian economy.

Sameer Aggarwal, CEO and Founder at Revfin
The vote-on-account the interim budget presented by the Hon'ble Finance Minister, signals towards a transformative era for the nation. The commitment to fortify the Electric Vehicle (EV) ecosystem and support manufacturing and charging infrastructure aligns with global environmental goals, positioning India as a leader in widespread sustainable mobility adoption. Continued focus on the rural economy support, youth skill development, and gender-inclusive initiatives reflects a holistic approach toward inclusive and sustainable growth. Skill India Mission's success in training 1.4 crore youth strengthens the workforce for evolving job demands.

Rishi Agrawal,CEO, at TeamLease Regtech
The government's revenue has exceeded expectations. Indirect tax reform clearly is paying off. It has helped widen the tax net and bring significant efficiencies in the economy. The budget has done well to focus on energy security, mass transportation and rural housing. It was heartening to hear the frequent use of words such as technology and innovation. Digital Public Infrastructure (DPI) has been a game changer in adding wings to India's dreams. It was good to hear the finance minister talk about DPI as a new factor of production instrumental in formalising the economy.  From an ease of doing business perspective, the industry expected some fund allocation on leveraging DPI to enable cashless, presence-less and paper-less compliance. The country needs to double down in building and implementing more use cases with DPI. There was also an expectation of greater focus on policy reform towards a more rationalised, digitised and decriminalised employer compliance in the post pandemic new world order. It will enable India to become Viksit by 2047.

Jayesh Jain, Group CFO, Balanchero India
The Interim Budget charts a transformative path towards a ‘Viksit Bharat’ by 2047, envisioning India as the world's third-largest economy. The notable 50 per cent rise in average real income signals economic empowerment for millions. 

A Rs one lakh crore corpus, paired with a 50-year interest-free loan for tech initiatives, showcases the government's resolute commitment to innovation and digital transformation. Expanded schemes like Mudra Yojana and robust gateways through International Financial Services Centres Authority (IFSCA) boosts our confidence in the sector's potential. Additionally, extending tax benefits until March 31, 2025 for startups, investments by sovereign wealth or pension funds, and certain IFSC unit incomes, reflects the government's promise to fostering entrepreneurial endeavours and promoting sustainable growth. 

This Budget seamlessly aligns with our vision of serving the next billion while creating a digitally inclusive India. We trust our efforts will leverage these opportunities to drive financial inclusion, empower individuals, and propel the nation towards economic prosperity."

Mayuresh Raut, Co-founder & Managing Partner, Seafund
The scheme for deep tech in defence will not only help the government start addressing the Make in Bharat initiative through indigenous technologies in defence but also unlock these technologies for other civilian uses. Deeptech-focused funds like ours will benefit from enabling initiatives like this.

The solar rooftop schemes will be a big boost to not only meet our goals for clean energy, but will also set up India to start addressing the EV charging infrastructure that is currently holding back wider adoption of EVs. It will also create enormous jobs for installation, manufacturing and maintenance of solar infrastructure and a secondary effect will be opportunities available for startups to build on this.

The extension of tax benefits for sovereign wealth funds expiring on 31st March 23 to 31st March 25 is a good signal from the government to indicate that there will be a continuation of beneficial policies and friendly institutional investor policies.

Hardika Shah, Founder & CEO, Kinara Capital
An excellent initiative in the form of ‘First Develop India’ (FDI) was introduced in today’s Union Budget. Negotiating treaties with other countries will boost foreign investment in the world’s fastest growing major economy as India is heading towards becoming a $30 trillion economy by 2047.

This is also the right time for the Government to reinstate the previous incentive for foreign portfolio investors (FPIs) as the tax rate was hiked from 5 per cent to 20 per cent on the interest earned on bonds. This rise in the tax rate will raise the borrowing costs by 30-40 basis points and create a liquidity crunch in an otherwise thriving economy with vast potential at every level. Particularly, for the NBFC sector which has been playing a pivotal role in addressing the last-mile credit needs of MSMEs, FPI investment has the potential to drive fast economic growth.

Harshvardhan Lunia, Chair, Fintech Convergence Council, and Founder & CEO, Lendingkart
In examining the Interim Budget, it is evident that Finance Minister Nirmala Sitharaman has crafted a vision encapsulating the themes of inclusivity, self-reliance, and comprehensive national development. The focus on marginalized groups and regional empowerment reflects a nuanced understanding of the diverse needs driving India's progress. Zooming into the Fintech and Lending landscape, the budget introduces strategic measures to catalyze long-term financing for private sectors, aligning with the nation's pursuit of technological advancement. The emphasis on innovation, skilling initiatives, and MSME support underscores a forward-looking approach tailored for India's digital age, aligned with the imperative of steering India's economic growth in the digital era. The financial sector's preparation and borrowing targets for the upcoming year signify a well-balanced approach to meet investment requirements. From a bird's eye view, the budget appears to set a positive tone for the convergence of technology and finance, contributing to the overarching goal of national development.

Manish Tewari, Co-Founder, Spydra Technologies
As the founder of Spydra, an enterprise-grade blockchain company in India, I am thrilled by the promising directions set in Budget 2024. The announcement of a corpus providing long-term financing with low/ nil interest rates is a game-changer for the private sector's Research and Innovation. This move aligns with our vision to foster technological advancements in the blockchain sector. The budget's emphasis on financial inclusion, tax incentives for rural fintechs, and investments aligns with our commitment to creating user-friendly CBDC platforms that can revolutionize payments & financial inclusion. The announcement of a corpus of Rs 1 lakh crore with a 50-year interest-free loan for the tech-savvy youth is fascinating. Budget 2024 has set an optimistic tone focusing on innovation, digitalization, and financial inclusion. The collaborative potential between the government, central bank, and companies like Spydra has never been more promising. We look forward to contributing to India's digitally empowered economy.

Saif Ahmad Khan, Founder, Luhaif Digitech
As the curtains rise on the Union Budget 2024, Finance Minister Nirmala Sitharaman's decision to maintain the status quo on tax slabs in both old and new regimes has raised eyebrows in the business realm. In a surprising move, she announced zero changes in direct and indirect taxes, alongside import duties, for the fiscal year 2024-25. This unexpected stability amidst political transitions has left the industry puzzled. As the Director of Luhaif Digitech, Saif Ahmad Khan notes, the decision aligns with the FM's earlier promise of minimal budgetary interventions due to impending elections. The anticipation now shifts to the complete budget unveiling in July, post-election, as stakeholders await potential fiscal directions in a post-poll landscape. The Modi Government's introduction of new income tax regulations in Budget 2023, particularly the defaulting to the new tax regime, adds an intriguing layer to the unfolding economic narrative.

Anubhav Agarwal, Managing Director and CEO, BN Group 
Finance Minister Sitharaman's Interim Budget holds promise for the edible oil industry. The continued focus on ‘Atmanirbhar Oil Seeds Abhiyan’ with its emphasis on research, technology adoption, and market linkages is a welcome step towards self-sufficiency. This, coupled with the increased capital investment outlay, paints a promising picture for rural development and increased consumption, both of which directly impact our industry's growth. However, the success hinges on the swift implementation of these initiatives. Streamlining access to high-yielding seeds, ensuring timely procurement at remunerative prices, and facilitating value addition, crop insurance are crucial for farmers to truly benefit. Additionally, sustaining the reduced import duties on key edible oils while strengthening domestic production can create a win-win situation for consumers and industry players.