Responses by Top Industry Leaders…
Mohit Malhotra, Chief Executive Officer, Dabur India Limited
A Budget that Focuses on Job Creation
The standout feature of the Union Budget 2024-25 was its focus on speeding up fiscal consolidation with the Fiscal Deficit being revised down 20 bps from the Interim Budget to 4.9%. While Finance Minister Ms Nirmala Sitharaman rolled out a string of measures for job creation, rural development, women empowerment and infrastructure investment, the announcement on Capital Gains tax seems to have come as a big dampener for the market.
Increased allocation in the budget towards Education, Skilling and Employment and special employment-linked incentive schemes for employees and employers aptly demonstrated the government mindset to significantly improve employment and employability in the country. These steps will go a long way in driving consumerism. The support for higher education loans and the push for women in the workforce are other big pluses.
The government has increased standard deductions from Rs 50,000 to Rs 75,000, revised tax rates under New Tax Regime and slab revisions would result in savings of around Rs. 17,500 in net taxes in the hands of individual. This would mean more disposable income in the hands of the consumers and would lead to sustained demand for branded consumer goods.
The Budget’s push on urban and rural growth will help boost rural consumption and also increase discretionary spending. Urban Housing needs of 1 crore urban poor and middle-class families are being addressed with an investment of Rs 10 lakh crore. The government’s decision to allocate Rs. 2.66 lakh crore for rural development, including rural infrastructure, and its continued focus on rural infrastructure development are big steps in the right direction. These measures would further boost consumer sentiments in the hinterland, which is already showing green shoots of revival.
Nitin Passi, Chairman & Managing Director, Lotus Herbals
“Budget 2024-25 was a big one in terms of lowered Fiscal deficit at 4.9% and with a roadmap towards 4.5%. This is great work by our Government and will help our country’s macro economic environment tremendously. The budget puts in focus skilling of youth and women which is the need of the hour. Consumption has been lagging in the country and the budget addresses that with job creation, income tax savings in hand of tax payers etc. These measures will spur consumer demand and lead to consumption led GDP growth.”
Vikram Bhatt, Founder Enrich, a leading salon chain in India
“It’s encouraging to note the following
- Simplification and Rationalisation of Capital Gains on Unlisted Companies
- Abolishing Angel tax for all classes of taxes for start-ups
- Proposed reduction in corporate taxes
- Increase in Standard deduction for salaried employees
These changes are likely to have positive impact for individuals and corporates alike.
On the other hand, Removal of indexation on sale of house may impact negatively.”
Shreedha Singh, CEO & Co-founder, T.A.C- The Ayurveda.Co
“Starting from scratch, I understand firsthand the critical role early support plays in turning dreams into reality. Credit schemes for MSMEs are transformative for startups, providing essential resources for innovation, idea development, and growth. These schemes are vital for fostering entrepreneurship and ensuring the success of new companies.
At TAC, where 70% of our workforce is women, I have witnessed how empowering women can break barriers and lead to remarkable success. The budget’s allocation of over ₹3 lakh crore for schemes benefiting women and girls, along with plans for more hostels for working women, is excellent. These initiatives will build necessary infrastructure at the grassroots level, paving the way for increased participation from women and the emergence of more female business leaders.Furthermore, the increased funding for the AYUSH Ministry demonstrates a strong commitment to promoting high-quality Ayurvedic products on a global scale. This support not only boosts domestic growth but also positions India as a leader in holistic wellness worldwide. I find these developments particularly encouraging. They support economic growth and empower more women to step into leadership roles, driving our collective progress forward.”
Samarth Kholkar, CEO and Co-Founder, BLive
The 2024 Union Budget has blown the bugle for India’s EV and last mile logistics sectors. With the waiving off of import duties on 25 minerals—critical inputs like lithium—and the outlay of Rs. 26,000 crore for road connectivity projects, will further support the adoption of EV for last mile revolution . These would also support to set the tone for the ambitious target of 30% EV sales by 2030.
PLI schemes are likely to bring down cell prices, making batteries more affordable. Better road infrastructure will improve the speed of goods movement and last mile efficiency. The potential creation of 30 lakh jobs in manufacturing adds another spark to our economic engine and benefits particularly the two-wheeler segment.
This optimism is further fueled by the abolishing of angel tax on all classes of investors, putting that extra zip in our startup ecosystem. The move is expected to reduce the financial and regulatory burden on startups substantially, encouraging more angel investors to fund innovative ventures in the EV and logistics space.
More intently, though, we believe that much bolder steps are now needed. Bringing down GST on all components of EVs to 5 percent will make electric vehicles more pocket-friendly and increase adoption. Our charging and battery swapping infrastructure must be expanded to eliminate range anxiety and provide seamless service to our users.
While we are charging toward a greener future, such additional measures certainly are something which we all look forward to seeing in effect. With absolute clarity now ahead, it’s on full charge, and India shall see its last mile changed with innovative, eco-friendly solutions. Electric, efficient, and enthusiastically embraced is the future of logistics.
Spoorthy Shetty, CEO, BBLUNT
I believe the budget has a balanced approach, focusing on employment and skilling, infrastructure and urban development.
There could be a potential short-term impact of the capital gain tax increment on investor sentiments. For our business which caters largely to the upper middle and affluent clientele, we anticipate minimal impact. The increase in disposable income due to new tax regime and changes in standard deduction for salaried employees might even lead to a slight uptick in discretionary spending, benefiting the mom and pop salons.