UNION BUDGET 2024: SOME HAPPY, SOME HOPEFUL

Team L&M

SO, how did the Union Finance Minister Nirmala Sitharaman fare in this Budget. We get you reaction from different industries:

Bhaskar Majumdar, Managing Partner, Unicorn India Ventures
This is recognition of the growing need for a deeptech economy. However, alongside the R&D Fund, the government should look at the Intellectual Property regime. The much overdue Patent Policy needs to come out soonest to enable maximisation of R&D Fund.

Anil Joshi, Managing Partner, Unicorn India Ventures
The 1000 Cr fund of funds for space tech is testimonial to India’s capability in coming up with breakthrough solutions at low cost. This will certainly help space tech companies to look for much needed early stage capital to get started. This will certainly help mobilise over Rs 4000 Cr, great move. Angel Tax abolishment was long pending, glad that Hon. FM has heard industry voices and has finally abolished it. This will certainly help in expansion of angel investment in India and will take away a lot of burden from the minds of everyone on tax notice for tax paid investment. This will also free up a lot of domestic capital and improve the funding sentiment in a strong way.

Mayuresh Raut, Managing Partner, Seafund
This was an albatross that hindered much needed capital to be deployed to deserving founders. Removal of this dreaded tax will give a huge fillip to startups in the country and free up investors to focus on the investments without having anxiety on how to deal with their implications. A few other things that work well for deep tech focused funds like us. The rooftop solar policy, the pumped storage policy and research and development for small & modular nuclear reactors, Bharat small reactors, R&D for small modular reactors, R&D for new technology in nuclear form a neat troika to alter the energy map of India. Specially on the nuclear side, it positions India to replicate the renaissance that nuclear is experiencing in the US.

Anirudh A Damani, Managing Partner, Artha Venture Fund
The removal of the angel tax will make it significantly easier for us to complete transactions faster and streamline the investment process. Previously, the requirement for income tax officers to understand and assess valuations led to unnecessary conflicts and delays, involving CAs, valuers, and tax officials. Valuation assessments were never meant to fall within the purview of income tax officers, and this change eliminates those complications. This simplification allows us to focus on our primary job—investing in and supporting innovative startups—without the burden of navigating through cumbersome tax regulations.
As a venture capital fund, we see the Indian Budget 2024’s tax reforms as a major boost for the VC, PE, and startup ecosystem. The increase in LTCG tax rate for financial assets to 12.50% and STCG to 20% may pose challenges for listed investments. Still, it’s a significant advantage for other financial products like startups and Alternative Investment Funds. The reduction in LTCG tax from 20% to 12.50% for these investments will result in substantial savings and increased IRR, fostering growth and innovation. While we await the detailed budget, this move is a long-awaited positive development that will make India an even more attractive destination for global investors and drive further growth in the venture capital and private equity sectors.

Ratna Mehta – Managing Partner, Fundalogical Ventures
Abolition of angel tax will provide a boost to the budding Indian startup ecosystem. It will  encourage the flow of capital without tax leakages, especially relevant at a time when the funding crunch is impacting startup liquidity. It is key to establish India as an innovation hub and leader vs follower for new and breakthrough ideas. Focus of the budget is on sustainable growth with employment generation, of continuity and stability. The changes on the capital gains tax structure was unexpected, especially during a time when the fiscal position of the economy seems to be in check.
The logistics and supply chain is the lifeline of India’s growth story. The budget’s identification of infrastructure, manufacturing, and skilling as key areas for long-term development and subsequent allocation is a step in making India the logistics and manufacturing powerhouse of the world. As a fund focused on investing in supply chain and logistics, we are bullish on backing innovative entrepreneurs building the support ecosystem of India’s supply chain. The government’s move to set up E-commerce export hubs to be set up for enabling MSMEs to export their local products is a huge step in the direction of driving growth through innovation and building on new-age trends to drive MSME growth.

Abhishek Gupta, Founder and Managing Partner at Pierag Consulting LLP
As a consulting firm, we recognize the transformative potential of this scheme. Our experience shows that access to finance is a critical barrier for many MSMEs looking to scale their operations and modernize their production processes. This initiative not only alleviates financial constraints but also encourages technological advancements and productivity improvements within the sector. We advise MSMEs to leverage this opportunity to invest in state-of-the-art machinery and equipment, which can lead to enhanced operational efficiency and better market positioning. Overall, this credit guarantee scheme is a promising development for the MSME sector, and we look forward to witnessing its positive impact on the growth and sustainability of businesses across the country.

Shalini Aggarwal, an internationally certified soft skills trainer
The emphasis on increasing women’s participation in the workforce in the 2024 budget is a commendable step towards gender equality and economic growth. By setting up hostels and creating partnerships for women-specific skilling programs, the government is addressing critical barriers to women’s employment. This initiative will empower women, enhance their skills, and provide them with safe and supportive environments. It’s a forward-thinking move that recognizes the untapped potential of women in driving India’s economic progress and social development.

Rashmi Mittal, Pro Chancellor, LPU
The Union Budget 2024’s focus on women’s workforce participation is commendable. Establishing hostels and women-specific skilling programs, alongside promoting internships in top companies, shows a strong commitment to gender equality. The provision of a ₹5,000 internship allowance and ₹6,000 one-time assistance, along with skilling 20 lakh youth over five years, will significantly boost opportunities. These measures, coupled with enhanced educational support, will empower women and youth, driving India’s economic and social progress forward.

Bharath Bommai, an industrialist and entrepreneur.
The government’s renewed focus on infrastructure spending is expected to dramatically increase demand in the industrial sector. The implementation of three employment-linked schemes will not only increase work prospects for new people entering the market but will also give critical support to employers, promoting a fair playing field for enterprises and organisations in the sector which will also enhance them to indulge in Industry 4.0 practices and equip themselves for export opportunities.
Furthermore, the credit guarantee schemes for MSMEs in the manufacturing sector—which allow them to purchase machinery and equipment without the need for collateral and offer guarantees of up to ₹100 crore—will enable businesses to grow and improve productivity, which will ultimately benefit the sector as a whole.

Gurdeep Singh, Chairman and Founder, Jujhar Group
The substantial allocation for PM Awas Yojana Urban 2.0 is a game-changer for urban housing. Addressing the housing needs of 1 crore urban poor and middle-class families with an investment of ₹10 lakh crore, including ₹2.2 lakh crore in central assistance over the next five years, is what we as an overall sector were looking forward to. The provision for interest subsidies to facilitate affordable loans demonstrates the government’s commitment to making home ownership accessible. This initiative will significantly boost the real estate sector, stimulate economic growth, and improve the quality of life for millions of Indians.

Dr Pradeep Multani, Former President, PHDCCI & Chairman, Multani Pharmaceuticals Ltd
The reduction in GST and Import Duty on APIs will help in stabilising the Pharma prices in the country, boost the domestic manufacturing and make the medicines available for the common people at lower prices. This is in alignment with the Government’s mandate of providing accessible health for all.

Dr Mandeep Singh Basu, Director, Jagat Pharma & Dr Basu Eye Hospital
The emphasis on facilitating term loans to MSMEs through the new credit guarantee scheme is appreciated. This initiative is immensely beneficial as it offers essential collateral-free loans, greatly improving credit access for MSMEs. This budget marks a significant advancement towards fostering growth and resilience within the MSME sector.
New and small businesses often lack sufficient collateral to avail loans, and collateral-free loans remove this barrier, allowing more businesses to access the funds they need to grow and operate. By offering credit-free loans, the government is encouraging entrepreneurship and the establishment of new businesses. We are confident that these initiatives will positively impact the sustainability and development of businesses nationwide.

Dr Jagprag Singh Gujral, SVP MDO/ Head of Emerging Markets, Varian, and Group CEO- CTSI
We commend the government’s proactive steps in exempting three additional medicines from customs duty for cancer patients. This decision will alleviate a significant portion of the financial burden faced by patients and their families, making life-saving treatments more accessible.
The BCD changes for domestic capacity addition for medical technology items like X-ray tubes and flat panel detectors is a crucial step towards self-reliance and enabling access to care in cost conscious, underpenetrated market. The thrust on MSME domestic manufacturing and abolishing Angel Tax will incentivise healthcare startups provide the foundation for enabling technology led innovations in the life sciences domain.
We are optimistic that these measures aim to strengthen the healthcare infrastructure and the Government’s commitment to improving healthcare accessibility and affordability is evident in the announcements. We look forward to collaborating with all stakeholders to ensure these benefits reach those in need.

Dheeraj Jain, Founder and Chairman, Redcliffe Labs
The exemption of custom duty on cancer medicines will enhance their accessibility and affordability for many. With cancer responsible for 71 per cent of deaths in the 30 to 69 age group and 15 per cent of cancer patients being children and adolescents in India, timely diagnosis and personalized care are paramount. Notably, 63 per cent of Indian women who succumb to cancer could be saved through timely screening, highlighting the urgent need for early diagnosis. By combining early diagnosis with immediate access to treatment for advanced-stage patients, we can significantly improve the overall healthcare landscape across the nation.

Ankur Mittal, Cofounder, Inflection Point Ventures
While we have to still read the complete change on the abolishment of angel tax but on the face of it, this action has the ability to bring lot of regulatory clarity which generally is appreciated by the investor communities across the world. This should help founders looking to raise capital both in domestic and international markets.

Harry Bajaj, Founder and CEO, Mobec
Union Budget 2024, presented by Finance Minister Nirmala Sitharaman, demonstrates a strong commitment to India’s energy transition and sustainable development. The introduction of the PM Surya Ghar Muft Yojana, providing rooftop solar panels and up to 300 units of free electricity to 1 crore households, is a significant step towards democratizing access to clean energy. Additionally, the focus on advanced ultra-supercritical thermal power plants and critical mineral recycling will bolster our green infrastructure. The energy audit and financial support for MSMEs will drive the adoption of cleaner energy sources in key industrial clusters. These initiatives not only align with Mobec’s vision of a sustainable future but also create a robust ecosystem for green innovation and energy efficiency in India.

Saiyam Mehra, Chairman, All India Gem & Jewellery Domestic Council
The reduction in the basic customs duty on gold and silver to 6 per cent and on platinum to 6.4 per cent is a commendable move by the government. This was a long-standing demand from the All India Gems & Jewellery Domestic Council, which represents the entire gems and jewellery industry. The customs duty reduction will benefit domestic jewellery manufacturers, especially small and medium enterprises, encouraging them to transition gradually to the formal channel. Additionally, the Finance Minister has also increased the scope of working capital loans to SMEs and MSMEs, which will help these units expand their businesses in the future. The extension of the direct benefit transfer scheme to the manufacturing sector, with separate salary and Employees’ Provident Fund transfers directly to the accounts of employers and employees, is a wonderful move. This will accelerate employment generation in India. Overall, this budget has focused on 9 key priorities of Viksit Bharat and we are proud to witness it.

Rajesh Rokde, Vice Chairman, All India Gem & Jewellery Domestic Council
We admire Finance Minister Nirmala Sitharaman ji’s Union Budget presented today, which stands out in several ways. Notably, after persistent efforts from GJC, the government has reduced customs duties on gold and silver to 6 % and on platinum to 6.4%. This move will provide significant relief to consumers who have been investing in alternative assets, encouraging them to return to gold investments. We are confident that household investment and savings in India will see an increase in the coming days.
Additionally, the expansion of working capital loans for SMEs and MSMEs in the jewelry sector will provide a much-needed boost. The increase in the personal income tax exemption limit will also benefit consumers and promote household savings. Overall, the Union Budget 2024 is commendable.

Sanjaya Mariwala, President, IMC Chamber of Commerce and Industry & MD, OmniActive Health Technologies
The 2024 Union Budget aligns with our expectations, prioritising infrastructure, skill development, and job creation. It places an emphasis on rural development, recognising the diverse needs of India’s economic landscape.
Agriculture takes centre stage with initiatives for climate-resilient crops and increased MSPs, aiming to boost farmer incomes and stability. A groundbreaking Rs 1 lakh crore fund for private-sector research positions India to compete globally and potentially replace China as a primary market in certain sectors.
With a focus on stimulating consumption, boosting employment, and creating a favourable environment for both domestic and foreign businesses, the budget sets the stage for sustainable economic growth.
Overall, a balanced budget presenting a comprehensive strategy for India’s development, addressing critical needs in agriculture, research, and infrastructure. An approach that has the potential to propel India towards a more competitive and prosperous future on the global stage.

Shamsher Dewan, Senior Vice President & Group Head – Corporate Ratings, ICRA Ltd
Budgetary allocation towards healthcare increased by 13.0% for BE FY2025 BE from RE FY2024. Given the backdrop of under-penetrated healthcare infrastructure in the country, increased budgetary allocation towards the healthcare sector is a welcome move. Exemption on customs duty for three more cancer drugs will make the associated treatments more affordable, thus benefiting the patients and the healthcare ecosystem. Reduction/exemption in customs duty on raw materials used in medical devices and implants is expected to reduce costs for medical device manufacturers. ~7.4% increase in allocation towards the Ayushman Bharat scheme reaffirms the government’s focus on national health protection and is expected to increase patient footfalls for healthcare companies.

Rajendra Gandhi, Managing Director, Stovekraft
We appreciate the government’s budget initiatives for the focus on the manufacturing sector, women’s empowerment, and new job creation. The establishment of working women’s hostels aimed at boosting women’s participation in the workforce are progressive step that will greatly benefit our industry. Additionally, the incentives for new employment in manufacturing, tied to EPFO contributions for the first four years, promise to significantly boost job creation. Furthermore, the customs duty exemptions on critical minerals will reduce production costs and enhance competitiveness. These measures collectively reflect a strategic and innovative approach to fostering growth and development within the manufacturing sector.

Vipul Shah, Chairman, GJEPC
The Union Budget 2024 is a game-changer for the gems and jewellery sector. The reduction in import duties on gold and silver to 6% and platinum to 6.4% is a major boost for our industry, enhancing affordability for consumers and competitiveness for the manufacturing sector by releasing working capital. The abolition of the 2% Equalization Levy and introduction of the Safe Harbour Rule on sale of rough diamonds at SNZs will firmly establish India as a global rough diamond trading hub. These combined measures will propel the sector’s growth, generate lakhs of employment opportunities by benefitting the small-scale jewellery manufacturers & exporters and diamond cutters and polishers, thus contribute significantly to India’s vision of becoming a Viksit Bharat by 2047.

Kush Kapoor, CEO , Roseate Hotels & Resorts
Though Budget 2024 did not provide direct tax rebates for the hospitality sector, it offers significant indirect benefits. The Finance Minister’s announcement of a new centrally-sponsored scheme for skilling 20 lakh youth over the next five years is a vital step. The revision of the Model Skill Loan scheme and the introduction of a new internship program, funded through CSR, will greatly assist in attracting skilled manpower, which our industry desperately needs.
The government’s upskilling initiatives, including the ₹5000 incentive for interns, are commendable and will ease operational expenses. This financial year has already exceeded our budget expectations, marking a historic performance for the industry. We remain hopeful for further support, but these budget measures have been positively received. Enhancing community education and basic skill training will not only double family incomes but also provide a more enthusiastic and skilled workforce, benefiting the hospitality sector immensely.

Sunita Ramnathkar, Founder Mitchell USA
As an MSME owner, I welcome the 2024 Budget’s focus on women, MSMEs, and startups. The Finance Minister’s announcement of Rs 2 lakh crore for employment and skilling, along with Rs 1.48 lakh crore for education and skilling, is a testament to the government’s commitment to inclusive growth. Emphasizing women’s welfare and their role in economic development is particularly encouraging. This budget not only supports MSMEs and startups but also fosters innovation and entrepreneurship. It lays a strong foundation for economic resilience and growth, empowering us to make significant contributions to the nation’s progress.

Dhawal Jain, Co Founder of Mave Health
We appreciate the government’s forward-thinking Union Budget 2024-25, especially the collaboration with the private sector to develop small and modular nuclear reactors. This innovative approach is a great example for other industries, including healthtech.
The Rs 90,658.63 crore allocation to the Union Health Ministry is promising, but more initiatives are needed to enhance mental health services and infrastructure. The budget’s focus on boosting domestic investments is a positive step for the Indian startup ecosystem. However, addressing corporate tax and redomicile taxation is crucial for creating a startup-friendly environment.
The rise of startups in the BFSI sector, driven by innovations like UPI, highlights the potential of tech-driven solutions. We hope for continued government support for healthtech innovations, similar to the focus on new technologies in the nuclear energy sector. We look forward to collaborative efforts that not only enhance the healthtech landscape but also ensure that startups like Mave Health can contribute meaningfully to the nation’s growth and well-being.

Amisha Vora, Chairperson & MD, Prabhudas Lilladher
The market reaction to the recent budget announcement signals an immediate response to the adjustments in capital gains taxes that investors had anticipated, confirming the government’s commitment to restraining speculative excesses while laying the foundation for sustainable growth. The increasing monthly SIP inflows and expanding mutual fund participation exemplify the developing trend of financialization of savings in India, forming a solid basis for future market resilience. Although the recent fiscal budget evoked an initial response, its impact was always likely to be restricted. The revised deficit target of 4.9 per cent of GDP indicates fiscally responsible policies, serving as a strong indicator of economic stability.
The budget’s explicit focus on increasing employment through support for skill development measures and infrastructure signifies a holistic strategy to promote inclusive growth. The Prime Minister’s strong commitment to Atmanirbhar Bharat, along with the clear prioritization of renewable energy and micro, small, and medium enterprises, underlines India’s seriousness about sustainable development goals and reducing import dependency. If correctly implemented, these initiatives have the potential to boost economic resilience and solidify the banking sector’s position, serving the broader objectives of recovery and growth in the medium run. The budget reflects the government’s economic vision of anchoring deficits, inflation & interest rate on one hand and broad basing the growth across capital goods and consumption to prepare India for stepping up 6.5 per cent to 7.5 per cent GDP to 7.5 per cent – 8.5 per cent over the next three years.

Dr Babina Nandakumar, Chief Medical Officer, Jindal Naturecure Institute
The Union Budget’s robust fiscal support for infrastructure, with Rs 11.11 lakh crore allocated for capital expenditure and ₹2.66 lakh crore for rural development, is commendable. The exemption of three cancer medicines from customs duty is a welcome relief. The previous interim budget’s allocation of ₹90,171 crore to the healthcare sector for 2024-25, up from ₹79,221 crore, laid a solid foundation.
However, we anticipated more support for holistic health practices. Increased funding and incentives for naturopathy could have advanced alternative medicine and provided diverse healthcare options. Support for research, traditional healing practices, and the establishment of naturopathy centers in tier 2 and tier 3 cities would have enhanced integrative healthcare solutions, blending conventional and naturopathic treatments for overall wellness in India.

Amit Shukla, General Manager, ALMA Lasers
The Union Budget 2024-2025’s emphasis on employment and skill development, along with a strong focus on manufacturing and innovation, is a significant boost for the skincare and beauty aesthetics industry. The initiative to skill 1 crore youth will enhance the talent pool, driving innovation and excellence in beauty treatments and skincare solutions. Encouraging local manufacturing will make advanced aesthetic technology more accessible, fostering growth and innovation in the sector. Additionally, the focus on inclusive growth and next-generation reforms will create a conducive environment for business expansion, contributing to the overall economic growth and improving the quality of life for consumers through better and more affordable beauty solutions.

Vikram Vuppala, Founder & Group CEO, NephroPlus
We were hoping that the healthcare sector would be granted infrastructure status in this budget along with an increase in healthcare expenditure which is less than 2.5% of GDP. But we welcome the government’s commitment to skill development, with a promise to upskill 20 lakh youth over the next five years and a month’s wage for new hires. This initiative will significantly boost employability and address the skill gap in various sectors.

Dr Aman Basheer Sheikh, Co-founder and Chief Medical Officer, TruthIn
The Budget 2024 announcement to facilitate the establishment of NABL-accredited food safety labs is a significant step towards enhancing India’s food safety standards. This initiative will improve the quality and reliability of food testing, ensuring consumers have access to safe and nutritious products. Additionally, allocating financial support for 50 multi-product food irradiation units is a significant step towards enhancing food safety and extending the shelf life of perishable goods. This initiative will aid in reducing post-harvest losses, improving food quality, and ensuring food security for consumers. Combining the availability of accredited labs and support for multi-product food irradiation units, along with the implementation of robust food labeling laws, will further boost consumer confidence by supporting businesses to meet stringent safety and ingredient disclosure standards. This comprehensive approach ensures a transparent and trustworthy food system, fostering greater consumer trust and industry integrity.

Ravi Putrevu, Co-founder and CEO, TruthIn
This uptick in FMCG stocks reflects investor confidence, anticipating that higher incomes will drive increased demand for consumer staple products. However, as India’s fourth-largest sector, FMCG’s rise highlights the pressing need for a better-regulated environment where all stakeholders come together to ensure sustainable growth. Effective regulation coupled with collaborative efforts will help maintain product quality, protect consumer interests, and support long-term industry stability. This holistic approach will enable the FMCG sector to thrive while contributing positively to the economy and society.”

Dr. Harsh Mahajan, Founder & Chairman, Mahajan Imaging & Labs and Chairman, FICCI Health Services Committee
‘This is a budget of continuity and for inclusive growth. Exemption of three life saving medicines for cancer treatment is a welcome step.  Exemption of customs duty on components of Xray tubes and digital detectors, will lead to spurring of indigenous manufacturing of digital Xray machines in India. Allocation of funds for innovation and skilling will also help those who are working in the healthcare sector.

Ashok Jayanthi, Chairman & Co-founder, Hosachiguru
Training and enabling 1 crore farmers in natural farming, along with certification and branding support, is a commendable step towards ecological sustainability. Moreover, the establishment of 10,000 bio-input resource centers across the country will provide essential bio-inputs on a constant basis. This initiative will significantly reduce the financial burden on farmers by offering cost-effective and eco-friendly alternatives. Together, these measures will greatly support the farming community, fostering sustainable agricultural practices and enhancing the overall agricultural ecosystem.