Tim Nicolle, Founder, PrimaDollar – The Finance Minister’s announcements under Union Budget 2020 introducing new schemes will help the small players in the export sector in a big way. The new Nirvik scheme introduces high insurance cover for exporters at a reduced premium. Simplified processes for faster claim settlements will be beneficial for both the exporters and the general insurers.It will lead to providing high insurance cover, reduction in premium for small exporters and simplified procedures for claim settlements,this will encourage export finance. This will boost exports. Coming to the MSMEs, the announcement for the subordinate debt for entrepreneurs is a big positive and will help the MSME sector benefit in a massive way. These seem to be sound measures that can stimulate profitable activities for players in the trade and finance sector.
Harsh Jain, Co-founder and COO, Groww – Making policy for data center parks for digital resources like fintech, AI, aggregator platforms along with the connection of 1 lakh villages via optical fiber internet is great news for digital India. This will definitely increase digital penetration into India that was unthinkable before.
Archit Gupta, Founder, and CEO, Cleartax – Firstly the deferment of ESOP taxation at the time of exercise is a very welcome move. This will help motivate and hire high quality resources. The amendments to section 80IAC on relief to startups is lacklustre. This section has several conditions that need to be fulfilled and a lot of approvals built into it as eligibility criteria. The government needs to relax this more. Reduced compliances via single window for multiple compliances, reduced applicability of various Acts could really ease doing business in India and this will be more impactful.
Meghna Suryakumar, Founder & CEO, Crediwatch – The focus on enabling growth for MSMEs in today’s Union Budget is encouraging. Enabling NBFCs to extend invoice financing to MSMEs through TReDS, should enhance opportunity to fuel the Indian economy and widen the acceptability and trust by the BFSI sector. The extension of GEM e-marketplace as a unified procurement channel should bring more vendors (from the current 3.2 lac) onto the platform. Additionally, amendments to Factor Regulation Act 2011 should boost the MSME sector. On the Debt Recovery side for lenders, the allowance to smallers NBFCs to approach the DRT for smaller ticket size loans, would be beneficial in lowering NPAs & improving the asset quality. However, we expected to hear more clarity on the scheme to provide subordinate debt to be provided by banks for entrepreneurs of MSMEs since less than 15 % of the 50+ million Indian Small businesses have access to formal credit and there is a debt financing gap of the SME is over $1 Trillion.By allowing data centre parks in the country, the government has set a positive sentiment for the industry. While this will allow better infrastructure in storing and dissemination of data, we were expecting the government to touch upon incentives for setting up data centres which will allow Fintechs to scale faster at an economical cost. This coupled with the extension of Bharat Net (FTH) to 1 lac gram panchayats would add a significant boost to the Digital push in the country.Given that several steps have been taken in the past to drive the Corporate Bond market in India, the increase of FPI limits from 9% to 15% is a positive push to increase international participation in high quality borrowers via the debt route. This coupled with easy access to credit from banks & NBFCs should bring down credit costs in the medium term.
For start-ups, considering the fact that in the initial years, one may not have adequate profit to avail this deduction, extension to avail the claim of deduction from the 7 years to 10 years is a breather. Deferral of tax on ESOP plans for start-ups should also help bring quality corporate talent to this industry.
Sandipan Mitra, Founder, Hungerbox,India has embraced the shared economy and welcomed the digital revolution with open arms. The Union Budget provides some important benefits for emerging entrepreneurs. With the corporate tax being slashed to 22%, companies can now have a little more room to breathe and benefit from the assistance in funding through the investment clearance cell that has been proposed. This budget has certainly addressed some challenges that were faced by budding start-ups and has made it easier for them to receive funding from investors.
Ankur Choudhary, Co-Founder & CIO, Goalwise.com – On the personal finance front, the 2020 budget has not lived up to the expectations of the taxpayers. While increasing the insurance cover for bank depositors from 1 lakh to 5 lakhs is a positive and much awaited step but on the income tax side, it has been a disappointment. Although a new tax regime with lower tax rates has been introduced, the removal of all exemptions including even 80C exemptions, will water down its benefits. On top of it, the option to choose the old or the new income tax regime will just complicate filing income tax returns which was already a complicated process for individual tax payers. Although the Dividend Distribution Tax has been abolished at the company level but now it will be taxable at the hands of the investor. For startups and MSMEs, the increase in turnover limit and number of years to avail tax exemptions benefits is a positive. Also, no audit for companies with up to Rs 5 crore turnover and amending the Companies Act to remove criminal liabilities for offences that are civil in nature will improve ease of doing business.
Udaya Bhaskar Rao Abburu, CEO & Managing Director, iRam Technologies – We welcome the budget. Our honourable standing Finance Minister Nirmala Sitharaman announced the series of measures in Budget 2020-2021 to promote the power and Infrastructure sector, and we as a company are looking forward to its future scope.
iRAM would be standing with Mrs. Sitharaman’s initiative to make the industry and commerce sector more technologically enabled with an emphasis on building Smart Cities, as well as the reforms that will be added in the development and infrastructure policies. We will be working with the government to drive the Smart City growth initiative through deployment of our various IoT based smart systems.
Furthermore, the budget allotted for the Infrastructure and renewable sector will aim at creating a more holistically developed, technologically driven future of the country, and iRAM Technologies, as an IoT based company, hope to keep up to par and additionally support the government in creating a New, Smart India.
Gagan Vermani, Founder & CEO, MYSUN (India’s largest online rooftop solar company) – Budget 2020 was a mixed bag for the Solar Sector. To boost generation and use of power, the government has brought institutional changes in some schemes. It expanded the ‘PM Kusum Scheme’ to 20 lac farmers to set up grid-connected solar farms on barren lands making ‘Annadata an Urjadata’. The setting up of grid-connected solar farms on barren lands would reduce the dependence on thermal and other non-renewable resources. Further, the setting up of large solar-powered capacity alongside rail tracks is in line with the idea of Green India.
The thrust on the integration of smart meters is good for the end-users and would push Discoms to provide better services at competitive prices. The 22,000 Cr is kept for the power and renewable sector, but the bigger question will be where and how that will be utilised. The key highlight was the Government admitting the distressed situations of the DISCOMs and assuring to work with them, which may relax sudden change of policies in key aspects like Net Metering.
The FM did leave a grey area when it comes to custom duties on imports and it will be a game of wait and watch there. The government’s pro-environment approach is visible with its stress on the ‘clean air scheme’. The abolition of the dividend distribution tax will encourage further investments in the renewable energy sector.
Sanjeev Aggarwal, Founder and CEO, Amplus Solar – The overall impetus on long term reforms in the power sector is very encouraging and it was noteworthy to note that India stands committed to its international sustainability commitments.
The focus on bringing down the commercial losses in the distribution companies by mandating prepaid meters, coupled with the consumers having the ‘choice of suppliers’ will surely resolve the long term viability issues of the power sector and lead to a vibrant electricity market. The usage of solar in the railways and farming and usage of farmlands for solar plants will open up new entrepreneurial opportunities and will help in faster adoption of solar energy across the country.
We are also encouraged by the support extended to NBFCs and infrastructure funds that can improve much needed liquidity. Also, the slew of tax incentives offered to foreign investors for investments in priority sectors will boost inwards equity flow in the infrastructure sectors.
Arun Gupta, Founder and CEO, MoMAGIC Technologies – As a new age technology player in the mobile advertising and IOT solutions space, the mention in the budget speech by the Honorable Minister about AI, IoT and Analytics and the Data being the new cliche for oil and hence the announcement of setting up of Data Centre parks throughout the country is a welcoming announcement.