A year ago the Narendra Modi government was challenged to deliver a ‘magical’ budget that could pull India out of the financial turmoil following a series of corruption scams and policy paralysis from the previous government but drafting Union Budget is no child’s play.
After Arun Jaitley’s maiden budget in 2014 which could not satisfy the thirst of the reform-ridden country, he detailed the 2015 Union Budget on Saturday which is dubbed as the ‘Make in India’ budget and promises to do the trick this time.
The marketing industry in India also had its share of expectation from the Union Budget while some are hopeful of the year ahead, some still see a lot of room for improvement. Digital Market Asia takes a look at some reactions in the market.
Backing the inclusion of NBFCs under the SARFAESI Act and Real Estate Investment Trusts, Brijesh Parnami, Chief Executive Officer of Destimoney Advisors said that, “on the whole this is a positive budget. It is indeed growth oriented. After having relaxed the norms in the earlier budget for individual tax payers, with further relaxations on medical, increase in transport allowance limit etc. The FM has tried to reach out to the middle class. The phased reduction of Corporate tax rates from 30 per cent to 25 per cent, over a period of 4 years, is indeed welcome.”
“There has been an attempt to focus spends on sectors that have a higher multiplier effect on the economy. The announcement that GST, which will get implemented from April 1, 2016 should be a great encouragement to the industry. Attempts to strengthen the social security net through Universal Social Security System and Atal Pension Yojana are steps in the right direction. The implementation though needs to be seen,” he added.
Housing and real estate continue to be pressing issues for the Indian economy and Indian digital experts believe that the FM has steps towards addressing the same. “The emphasis on reducing the over dependence on the cash economy and going after black money should hopefully see some trickle down benefits in real estate which is arguably, the largest ‘absorber’ of black money in the country. Perhaps, it will become reasonable to expect prices to soften if this key component of real estate demand goes down,” said Manish Shah, Co-founder and CEO of BigDecisions.com.
It has been unanimously accepted the move toward GST is indeed a positive step from the government. Sameer Parwani, CEO and Founder of CouponDunia reiterated the sentiment and said,” The hike in Service tax rates is also an indication of implementation of GST. The Royalty and FTS rates have been reduced from 25 per cent back to 10 per cent come as a relief to the industry. “
Further, fuelling the entrepreneurial aspiration of young minds in India, Mr Jaitely also announced allocation of INR 1000 crores towards the same. “The budget allocation for startups should be used to promote startups in Tier 2 cities and beyond. This can lead to significant generation of quality employment at par with city counterparts for youngsters in these regions. Areas to be focused should be technology, commerce and education/training,” said Sanjoe Jose, CEO of Talview.com.
The industry must understand that financial decision makers in the country do not hold a magic wands using which they can change the market forces operating the county. There is no quick fix solution to the existing problem but this budget promises to be a step in the positive direction.