2020 was a year full of challenges for livelihoods and the overall economy of the country, sparked by the COVID-19 pandemic. According to the National Statistical Office (NSO), India’s GDP is estimated to contract by a record 7.7 percent during 2020-21 fiscal as the pandemic severely hit key manufacturing and services segments.
The Union Ministry of Finance is all set to roll out additional measures to revive the slowing economy, post the Rs 20 lakh crore COVID-19 relief package announced in May 2020.
The upcoming Budget is also expected to boost domestic manufacturing across sectors, in line with the Indian government’s focus for a self-reliant economy.
This year, for the first time in the history of independent India, the Union Budget will be paperless. It is expected that the Budget papers, including the Union Budget and Economic Survey, will not be printed, and the government will provide soft copies for these documents.
With the Union Budget just around the corner, every sector, including the Indian startup ecosystem — the third-largest startup ecosystem of the world — is eagerly waiting for the annual budget, to be presented by Finance Minister Nirmala Sitharaman on February 1.
Here’s a look at what Indian business leaders, entrepreneurs, investors, and other stakeholders across the Indian startup ecosystem expect from the Union Budget.
More focus on ease of doing business – Deepak Gupta, Founding Partner, WEH Ventures
One area which has implications for growth and job creation is the ease of doing business (“EODB”). Within that, India lags substantially relative to most in the area of enforcement of contracts. There are many elements to resolving this issue — from accelerated recruitment of judges to the improvement of arbitration processes, and others. We hope that action can be taken on this front in short order with specific pronouncements in the budget and follow-up from thereon.
Efforts to improve rural healthcare – Meena Ganesh, MD and CEO, Portea Medical
Despite 75 percent of the Indian population residing in rural areas, the healthcare concentration is heavily skewed in the urban areas. The best and fastest way to ensure quality healthcare access in rural India is through e-health/e-medicine services.
Funds must be allocated towards skill development of teachers, nurses, paramedical staff, and caregivers. Further, by making budget allocations for the development of telemedicine and home-based healthcare ecosystem in the country, it is possible to best harness the available resources to cover the whole country. This can be done through a public-private partnership more speedily and effectively.
Regulation of hygiene industry – Vikas Bagaria, Founder, Pee Safe
This year’s Budget gives us hope of better regulation of the hygiene industry, which will help in attracting more foreign investment. We believe that an increase in healthcare expenditure is crucial at this juncture, and India, currently, has the lowest public health expenditure in terms of GDP percentage. The country needs an equal, easy, and affordable access to quality healthcare.
As far as taxes are concerned, the provisions drafted must require no major changes for at least three years. This would reduce the compliance burden on startups and make management easier. Wherever needed, corrective changes need to be made to make implementation easier.
Facilitating better infrastructure for mental health startups – Shumita Kakkar, Founder, United We Care
There is a need to integrate technology-driven startups in its action plan to boost the physical, financial, and mental health of the public.
- Cheaper finance: There must be a multi-pronged approach, starting from making cheaper finances available to e-platforms, foreign, and institutional investments simpler and more attractive, and policy support to startups. Mental health consultations and support services can be given tax exemptions and incentives to expand their coverage and employ more consultants.
- Facilitating training: Another key initiative must be in the form of facilitating training and education for mental health counsellors, psychiatrists, and other advisors to create a larger number of specialists.
- Expand mental health coverage: By collaborating with the private sector e-platforms, the government can expand mental health coverage all over India, and effectively support the wellness of hundreds of millions of people. Integrating cutting-edge technology by such startups should be incentivised.
- Cover mental health under insurance: Mental health consultations should also be made a part of coverage under insurance. Health insurance policies cover mental illnesses currently, but making consultations a part of it might encourage more people to opt for it.
Building better tax infrastructure – Shilpa Ambre, CFO, SARVA
Today, the GST we are paying is as high as 18 percent. But, in the upcoming Budget, we hope that this is corrected, given the increasing importance of wellness becoming a lifestyle as opposed to vanity metric.
Also, a “tax holiday” by the government could be a good move. I do expect the Government of India to introduce more incentives that encourage employers and employees to naturally gravitate towards making wellness mandatory at the workplace. This can be done through tax exemptions when an individual invests in his/her health, or some sort of rebates for corporates who make conscious choices for the health and wellness of their employees.
More budgetary support to healthcare – Nilesh Aggarwal Director and CEO, Medtalks
- Budgetary infusions: India’s healthcare budget in terms of GDP ratio has been abysmal until now, and the chinks in the armour were thoroughly exposed by the pandemic outbreak. The time has come for the government to scale up the investments in healthcare, and create budgetary provisions for capacity building and supporting technology-driven healthcare startups from the private sector as well.
- Creation of healthcare professionals: The government needs to build training and development infrastructure to create more skilled healthcare professionals, and to facilitate skill enhancement of the workforce to meet the post-pandemic needs.
- Reduce dependency on China for imports: The Indian medical and pharmaceuticals sector depends greatly on China for APIs and imports a lot of medical devices. The government needs to support Indian companies to overcome this need by supporting the domestic manufacture of equipment and medicines.
Strengthen the infrastructure industry – Sanchit Gaurav, Co-founder, Housejoy
The COVID-19 pandemic has drastically changed the landscape of construction in India. The pandemic’s impact is likely to be felt in terms of the pricing of construction projects. The availability of materials has become more challenging due to certain restrictions. However, we are confident that the government will take measures to ease the situation by providing interest subsidies, reducing GST rates, etc., in the upcoming Budget.
Nonetheless, the government has frequently announced plans to strengthen the infrastructure and construction sectors, and we are confident that the sector will receive much-needed support in the upcoming Budget announcement.
Incentivise export of technology products – Tapan Barman, Co-founder and CEO, Mihup
The pandemic has driven global companies to look at India as an alternative to China in terms of technology and manufacturing.
- Simplify taxation: By simplifying things such as taxation, investment, and offering further incentives to Indian startups, the government can help in helping them generate more revenue and employment.
- Cutting-edge technologies: Development of cutting-edge technologies should be incentivised. The Indian government can further enhance innovation in the technology and manufacturing sectors. This can be done through infrastructural and financial support, and skill development, and integration of cutting-edge technologies in all sectors, including governance.
- Export of technology products: This should be incentivised. The Indian IT sector is already renowned globally, and now is the best time to make the country the global hub in tech innovation and automation.
Infuse more liquidity for MSMEs – Vivek Bindra, Founder and CEO, Bada Business
The government can provide further policy support to MSMEs to tide over the recessionary phase. Given the fact that this is the first Budget post-COVID, the industry is hoping for concrete measures to revive the economy, ways to increase consumer demand, particularly in sectors that were hit hard by the COVID-19 crisis.
- Infuse more liquidity: Through the Budget, the government must find ways to infuse more liquidity into the system, leave more money into the hands of consumers, and further ease the process of fund disbursement to MSMEs. Less complex GST structure and ease of taxation for MSMEs should also be a priority.
- More support to the manufacturing industry: The government must create a competitive tariff structure that favours imports of raw materials over imports of finished goods.
- Boost rural enterprises: It must also find ways to boost a wave of new micro-enterprises in rural India to create more employment opportunities outside agriculture. Building the entrepreneurial capability of rural youth through business training, easing the norms to start businesses, and creating a fast loan disbursement mechanism for micro-enterprises in villages, can help infuse a new entrepreneurial energy in villages.
- Job creation: The government needs to infuse more infrastructure based activity in both the rural and urban economies to generate more work opportunities.
De-silo healthcare-as-a-service provider – Kamal Narayan Omer, CEO, Integrated Health and Wellbeing (IHW) Council
It is time we de-silo healthcare-as-a-service provider, and look at the various other aspects that impact the need for health services or its efficiency. Apart from increasing the overall share of public spending in healthcare, the health budget this year must focus on its integrated nature, and adequate budgetary allocations must be made for:
- Primary healthcare: Especially in rural and remote areas, ensuring trained manpower and diagnostic services, in addition to affordable and accessible secondary and tertiary care
- Preventive healthcare: To control the rapid spread of non-communicable diseases and lack of adequate nutrition for the young and vulnerable population
- Focus on associated areas: This includes areas such as pollution control measures for air, water, and soil, and strengthening of the supply chain, especially for perishable food items.
- Health communication: A separate allocation must be made for health communication for behavioural change that will nudge people to adopt healthy and sustainable consumption and behaviour in the medium-to-long run.
Focussed approach for rapidly spreading NCDs – Nikky Gupta, Co-founder and Director, Teamwork Communication Group
The healthcare sector should be accorded the status of a priority sector, unlike all these years, and enable access to funds, as well as tax incentives to improve the affordability of care. India must allocate more funds to generate awareness about non-communicable diseases in people, and induce behaviour change in order to control it. Focussed approach for rapidly spreading NCDs, such as cancer and diabetes, will go a long way to control both morbidity and mortality.
A budget for financial inclusion – Ajay Lakhotia, Founder, StockGro
Pandemic has given a unique window of opportunity to introduce radical changes in economic policies. Tax reforms incentivising increased investments in government bonds, and with secure returns would be first on my cards.
From a startup ecosystem perspective, relief from direct and in-direct tax filing for at least two years would help founders focus on business instead of compliances. Overall, a budget for financial inclusion, especially promoting saving and investment across masses instead of classes, is the call of current times.
Invest heavily in the manufacturing sector – Raj Patel, Director, Royale Touche
We expect a strong push from the government’s side to invest heavily in the manufacturing sectors. Hence, the ease of doing business and making Indian business competitive on a global scale should be the priority. Also, the PM’s dream — Pradhan Mantri Awas Yojana (PMAY) — to provide affordable housing to all the citizens of India will remain a significant driver for the segment in the upcoming Budget.
Levy 100 percent customs duty – Nevil Patel, Director, Orpat Group
We hope this time the government to come forward and levy 100 percent customs duty on finish products exported from other countries to support the local manufacturers. This will improve the production infrastructure and create employment opportunities.
If the government announces these measures, it will be a good start for the year, and it will also boost the morale of companies like us to step up our game in achieving the dream of a self-reliant India. By increasing import duties, it will strengthen the position of domestic products in local markets.
Empower the domestic tourism – Vimal Singh, Founder and CEO -ReadyAssist
Road safety must be brought to mainstream with the allocation of funds for awareness, setting up emergency response ecosystems, and improving highway safety and infrastructures. Domestic tourism should be empowered, and housewives should be encouraged and incentivised to become brand ambassadors of local tourism. Riders and the bloggers/vloggers communities should be recognised as they play a large part in our local tourism.
Increased focus on agri investments – Jinesh Shah, Managing Partner, Omnivore
Agritech has been instrumental in helping India manage disruptions caused by the management of COVID-19. The sector saw significant support from the government in this trying period. Furthermore, farmer-focused direct benefit transfer (DBT) initiatives have helped build resilience in the rural economy.
Early-stage enterprises, aimed at post-harvest value addition, must be incentivised and encouraged as the development of innovative fresh produce supply chains and a vibrant food processing sector are key to better price realisation for farmers. I believe the Budget will further add to the momentum we have seen over the last two quarters, with an increased focus on agri investments and agri digitisation.
Strong focus on renewable energy – Rahul Sankhe, Co-founder and President, SenseHawk
We expect the government to have a strong focus on renewable energy in this Budget as in previous years. As a SaaS startup offering solutions for solar companies globally from India, we are excited about how the government has been vocal about India taking a leadership role in the clean energy wave. We believe AI solutions are getting widely adopted for managing solar assets globally, and India is no exception, and are hopeful that stimulus for the sector in the budget will drive growth for the industry.
Increase higher education budget – Prof (col) Shishir Kumar, Director General, ImaginXP
Last year’s Budget had allocated Rs 38,317 crore (40 percent of the total budget) towards higher education. With one in five students unskilled for the modern workplace and about 60 percent unemployability in the higher education graduates in India, I implore the finance minister to increase the higher education budget by about at least 25 percent. Last year, only Rs 125 crore was allocated to teacher and adult training. We need to significantly increase our focus on teachers as they are the backbone of the education system. We have to invest in the right future skill force, then only can we achieve the PM’s $5 trillion dream.
A progressive surcharge can be a better option – Jiger Saiya, Partner and Leader – Tax and Regulatory Services, BDO India
- Tax relief to employers: To encourage employers to retain and re-hire employees or avoid layoffs, Canada introduced a subsidy to the tune of 75 percent of wages for qualifying employers. Similarly, Australia introduced a wage subsidy of 50 percent of an existing apprentice’s or trainee’s wage for up to nine months. While no similar subsidies were doled out in India, tax relief in the form of a conditional weighted deduction for salaries paid, corresponding to the impacted period, would aid disrupted employers.
- Avoid COVID-19 cess or surcharge: Could taxpayers see a COVID-19 cess or surcharge this Budget? The answer would hinge on how the government plans to fund the fiscal deficit created by the stimulus, and the budgeted spend on vaccination drive. However, between a cess and a surcharge, a progressive surcharge could be a better option as it will not put an equal burden on small taxpayers.
Abolish long-term capital gains tax – Shashank Udupa, Co-founder and CFO, Avalon Meta
A lot of retail investors are hoping for the long-term capital gains tax (LTCG) to be abolished, which would provide a lot of relief to existing retail investors, as the government currently charges both LTCG and Securities Transaction Tax (STT). With Sensex close to a historic high of 50,000 levels, a favourable 2021 Budget will push the market to new highs and vice versa.
While India is slowly recovering from the COVID-19 induced slump, all eyes are on the Budget and the possibility of tax reliefs for the average middle-class Indian, which would help boost spending, and thus revive the economy.
Strengthen credit lending for MSMEs – Viraj Sheth, Co-founder, Monk Entertainment
As a medium-sized enterprise owner and entrepreneur, one of the key expectations I have from the Budget is focussed on improving the health of the state of the MSMEs in India. A lot of entrepreneurs are hoping for relief measures in the form of credit lending. Moreover, with the pandemic, the push towards digital adoption of businesses, has only been expedited. Educating the MSMEs and giving them easier access to adapt to this new world would reap immense benefits.
A favourable budget for common taxpayers – Raj Shamani, Founder of Shamani Industries
One expectation from the 2021 Budget — it should be favourable to common taxpayers. This year, they were the one most affected, the ones with maximum EMIs, maximum responsibility, and expenses on a recurring basis. But because of the pandemic, they have seen the lowest days. Providing some relief to the common man is the need of the hour. With this year’s Budget, I am expecting some relief in the tax slab for the common taxpayers. Given the fact that this is the first budget post-COVID, the industry is hoping for concrete measures to revive the economy, ways to increase consumer demand, particularly in sectors that were hit hard by the COVID crisis, like the retail industry, tourism, hospitality, etc.
Availability of working capital for startups – Shivjeet Ghatge, CEO and Co-founder, StepSetGo
A focal point for startups is the availability of working capital. While according to NASSCOM the investment ecosystem is set to return to its pre-pandemic levels, if not exceed it, a mobilised framework for funding would be a great start that would increase the ease of inflow and outflow for foreign investors.
Considering the size of the Indian software exports, we are hopeful that this year’s Budget increases the prioritisation of growth opportunities and incentives for indigenous, homegrown brands.
For the startup industry, initiatives like ‘Make in India’ have helped put Indian tech companies at the forefront and drove international visibility.
Reinvent India’s health system – A Ganesan, Group Vice Chairman, Neuberg Diagnostics
The domestic players can continue to fuel India’s growth in the healthcare sector, and to make the ecosystem more vibrant and responsive, a few of the things that need immediate attention are:
- CGHS/EHS dues are not still being paid regularly, despite assurances by the central government. Besides, the paperwork for submission of claims is so voluminous, resulting in substantial hardships.
- MSME rules are only on paper and government departments/agencies are not respecting these rules. These departments/agencies first should set an example by paying legitimate claims within due dates.
- GST on all supplies/services to hospitals and laboratories should be removed. Hospitals and labs have no output GST liability, and hence the input credits cannot be availed by the lab. In case the GST is abolished on supplies to hospitals and labs, the price to consumers will come down significantly.
- Health insurance premiums, over the years, have become more expensive. To make it more affordable to larger sections of society, the GST on health insurance premiums should be withdrawn
- As per section 80-D of the Income Tax Act, premiums paid by the individual taxpayers are allowed as deduction subject certain maximum amount, depending upon the age of the taxpayers. The maximum amount of deduction should be increased substantially to all categories of taxpayers.
- As per section 80-D, preventive health check expenditure up to a sum of Rs 5000 can be claimed as a deduction. But, this deduction is allowed subject to the overall ceiling fixed. There has to be a separate deduction, and the expenditure incurred has to be increased to Rs 15,000 and should be extended to the spouse of the taxpayer.
Budgetary provisions for travel and tourism industry – Bhanu Chopra, Founder and Chairman, RateGain
The hospitality and tourism industry was among the worst-hit due to the COVID-19 outbreak. Now, there seems to be light at the end of the tunnel as the demand is slowly and steadily increasing. It will give the sector much-needed push if the government includes the same in its concurrent list.
Budgetary provisions, better regulations, and policy decisions can go a long way for businesses of all shapes and sizes. The government should also consider granting the segment infrastructure status, given its importance in revitalising the economy. Doing so will allow businesses to avail electricity, water, and land at industrial rates along with improved lending rates.
More growth opportunities for MSMEs – Shivendra Nigam, CFO, Cantabil Retail India Ltd.
The government has taken a lot of appreciable initiatives to secure the interest of MSMEs. However, there should also be a focus on large enterprises that are dealing with MSMEs. The government should take steps like making GST returns filing dates the same for all categories of taxpayers, as large taxpayers regularly face working capital pressure due to non-filing of monthly returns and blocking of input credit.
Also, we expect some tax relaxation and incentives for taxpayers to have more cash-in-hand and spending power, which will result in more cash inflow in retail to boost the economy.
Apart from this, many people have lost jobs amidst the pandemic due to the hard-hitting impact on the retail industry. It would be interesting to see how the government would address the job creation and security issue in this badly affected economy.
Support for transportation, logistics, and hospitality sector – Alok Mittal, CEO and Founder, Indifi Technologies
The economy is currently in a rebuild mode, and hence, sectoral incentives play a pivotal role as they allow MSMEs to recover. Although different sectors have been hit differently, large sectors like transportation, logistics, and hospitality have been the worst-hit. As a result, there needs to be an initiative to provide them with support and recovery measures. Secondly, the wholesale lending market needs to be refuelled, with a focus on BBB and A-rated NBFCs. This will be a step in the right direction and help the overall economy recuperate faster in the coming months.
Enthusiastic and more supportive fiscal policies for fintech companies – Kumar Abhishek, CEO and Founder, ToneTag
With regards to the budget, we are anticipating major changes and incentives this year, especially for the fintech sector.
- Establishing Indian fintech footprint globally: We expect the government to ramp up its efforts in driving campaigns and schemes to encourage migration to the digital space.
- Encouraging fiscal policies: We are also expecting fiscal policies that encourage banks and financial institutions, especially those in rural areas, to partner and work closely with fintech companies to expand their digital service suite and integrate fintech to provide end-to-end processing instead of piecemeal service.
Boosting the transportation and logistics sector – Sonesh Jain, EIR, WheelsEye
Budget 2021 comes right after a global pandemic and is expected to bring relief to the recession-struck economy of India. Due to the lockdown, numerous industries were affected severely. The logistics sector, which played a crucial role in keeping the country’s economy afloat, is among those in need of dire help. Therefore, the upcoming budget must allot and utilise adequate funds for boosting the transportation and logistics sector. Key expectations include:
- Implement uniform and subsidised diesel rates, especially for transporters with less than five vehicles.
- Revision to lower GST slabs for small businessmen to boost profitability.
- Allow NETC and NPCI to solve toll or traffic-related payment disputes in real-time.
- Empower software and hardware related innovation and partner with startups to solve on-ground real problems.
- Develop a data and resource centre to make logistics-related databases and statistical information easily available.
- Policies on standardising GPS and other technologies to automate toll collection, business operations, and increase the safety of commercial vehicles.
- Develop a better custom documentation process and an integrated platform with access to all export formalities for bringing ease and transparency among importers and exporters.
National retail policy, increase in FDI inflow, and more – Ravi Saxena, MD, Wonderchef
Starting the year afresh and on a positive note, everyone is anticipating Budget 2021 with much optimism. The industry is eagerly waiting for the government to introduce the National Retail Policy and streamline the compliance mechanism to facilitate business expansion.
Also, we are expecting an increase in the FDI inflow, which would help organised players to expand their presence as well as have access to the best manufacturing practices, in step with the Make in India initiative. This budget also needs to take into account the rising input costs so that the end consumer doesn’t have to face the dual setback of coronavirus-led financial strain and price rise.
Resolution to long-pending policy expectations in real estate – Pradeep Misra, CMD-REPL, Rudrabhishek Enterprises Ltd
The real estate sector is heavily driven by government policy and the availability of investible surplus income in the hands of common people. Some of the long-pending policy expectations include:
- grant of industry status
- ease GST regulations
- increase tax incentives to buyers
- easy finance for the sector
- single window clearance
Some other expectations include:
- Direct measures to address liquidity crisis may include FDI in rental housing, and ECB permissions in all real estate projects.
- Make provisions for direct infusion of funds in the sector through existing channels like SWAMIH funds. Also, another state-centric fund – SWAMIH funds-II – should be launched wherein state institutions can contribute 50 percent of capital.
- Regional offices in respective states should fund projects in only Tier-II and III cities, under the current fund.
- Infrastructure sector is looking for more spending from the government side, as India is going to host the G20 summit in 2023.
- New flagship programmes for urban infrastructure, transportation, tourism, rural employment, etc ., should be announced.
- Adequate allocations for quicker economic turnaround and consolidating India’s position as a world-class economy.
Formalising online education should be the priority – Rohit Gajbhiye, Founder, Financepeer
The stakeholders in the edtech sector are eyeing the Budget 2021 with a lot of expectations as the government has already signalled allocation of 6 percent of the GDP towards education. This can be a healthy start towards strengthening the sector. Aligning with it, we expect the government to introduce a framework for formalising online education by coupling it with exhaustive provisions for bridging the digital divide between both ends of the education value chain i.e. the teachers and the students.
Also, the gap in the quality of education between rural and urban areas has to be a priority, and technology is pivotal for that. We are also expecting the government to lay the ground for a gradual increase in the annual budget of education to 10 percent of the GDP to create an ecosystem for a vigorous research and development infrastructure.
Improvement in credit facilities and accessibility of funds for MSMEs – Vishal Gupta, Co-founder, Brands2Life
Startups and MSMEs are looking for some measures to improve the credit facilities and accessibility of funds that can mobilise the growth and further help the sector to revive from COVID-19. Also, the Production Linked Incentive (PLI) scheme needs a stronger framework that will further strengthen the Aatmanirbhar Bharat initiative.
As technology-led developments are taking place at a faster pace, the MSMEs sector needs more encouragement from the government for its adoption. More entrepreneurship and incubation programmes should be prioritised for the Budget. The entire world is adopting new SOPs in 2021 and this budget should set the launchpad for making India the global leader in this decade.
Focus on healthcare – Shekhar Rawtani, Founder, Prescrip
With the COVID-19 vaccine being rolled out, and other structured and effective measures in place to combat coronavirus, there is no doubt that 2021 is going to be a milestone year for the healthcare industry. We hope that the government will present a budget with a bigger focus on healthcare. The ongoing pandemic has put healthcare in the spotlight and has exposed several gaps in the ecosystem. Hence, we need policies that can cover wide-ranging voids in infrastructure, facilities, and financial provisions in the upcoming budget. Making budgetary provisions for our frontline workers, who have been pivotal in our fight against the pandemic, should be one of the key focus areas of the government.
The year 2020 has also set the base for digital transformation and innovations in the healthcare system, and 2021 policies must work towards scaling them, increasing digital inclusion in the remotest corners of the country.
Increase education expenditure – Aakash Chaudhry, Managing Director, Aakash Educational Services Limited (AESL)
National Education Policy (NEP 2020) has already set the pace for enormous skill development for the youth. We are expecting that the government will increase the education expenditure in the current education budget. With more focus on the implementation of the new policy, quality and tax-free education, and skill development, the reforms will pave the ways for more blue-collar jobs. As classroom education has undergone a complete change due to the emergence of COVID-19, we expect that the government will put more focus on online education in Tier II and III cities, and envisage avenues to make India one of the preferred higher education destinations in the world.
Improvement in the healthtech sector – Karan Chopra, Founder, Hospido.in and Co-founder, Doctor On Call
There is a very high expectation from the budget for healthcare startups, especially in a country like India where digital health can truly cater to areas that have a short supply of doctors.
- Healthcare platforms connecting patients to doctors have to pay GST on their revenues, whereas broader healthcare services are exempt under GST. Such platforms should also be exempted from GST.
- Subsidies and lower taxation for healthtech players can also promote innovation in the sector and open access to a lot of people
- One nation one medical record policy should be introduced where we digitise medical records of the entire population. The government will have to bring together payers, providers, and doctors to implement this.
More support for technology startups – Gaurav Shinh, Founder and CEO, DAAS Labs
The government has started realising the importance of new technologies like Artificial Intelligence and Machine Learning, and has even called ‘data as the new oil’ in the previous Budget 2020. According to a recent NASSCOM report, deep-tech and new startup hubs will continue to grow at 40-45 percent CAGR. It also stated that investments are expected to return to 2019 levels, after seeing a dip in 2020 (if not exceeding in 2021).
The pandemic has been a huge boost to edtech, agritech, fintech, HRtech, and healthtech startups. So, we expect to see decisions to fuel the growth of cloud data storage, big data, and AI technologies in several domains. The pandemic sparked the work from the home trend, with a lot of tech investment being made into Tier II and III cities, and the trend is supposed to continue. Reforms are expected to support and enable these startups as they can have a huge long-term impact.
Take lead on climate change: Anshuman Bapna, Founder, Terra.do
A post-COVID-19 budget is a historic opportunity for India to take the lead on climate change in two ways – first, by avoiding the $2 trillion energy infrastructure mistake that the US and China made by decisively moving away from coal, and second, by learning from China and making deep investments in becoming a manufacturing world leader for a renewables-powered world.
The budget should balance this push towards cleaner energy with job retraining programmes for the millions of impoverished Indians who are dependent on coal for their livelihoods.
Education and training are key to creating the new workforce India will need to build a climate-resilient and climate-saving future. Thus, it is time to invest in a new generation of clean energy engineers, regenerative farmers, smart grid planners, and solar installers.
Increased budget for education – Mohammad Zeeshan, Co-Founder and CEO, MyCaptain
As compared to the Rs 99,000 crore allocated in 2020, we might need a slight increase in budget this year; as a lot of technology will have to be implemented at a massive nationwide scale to transform education amidst the pandemic. Keeping the costs of technology in mind, there should be at least a 5-7 percent increase in the budget, specifically allocated to the technological part of education.
Also, there should be GST subsidies for edtech companies providing any kind of services to college and school students because right now, it is heavily dependent on the private sector, and the private sector incurs 18 percent GST on education. So, considering the pandemic, we should get a subsidised GST for the edtech sector for at least the next two to three years.
Increase turnover limit for startups – Siddharth Kothari, Chief Investment Strategist, Om Metal Group
The turnover limit of startups must be increased from Rs 100 crore to Rs 200 crore for a 100 percent tax deduction. There is no need to tax these companies when they are small. Even if one turns out to be a unicorn, it takes care of the taxation requirements of a thousand others. Some other expectations are:
- Try public-private partnerships for healthcare startups: Startups that promote health checkups, health insurance, and telemedicine must be supported. Health insurance still remains a distant dream for many, and it’s about time that we leverage technology to reach the masses.
- More focus on agritech startups: The new farm laws, if implemented successfully, would require the use of technology to keep checks and balances in place. Even if they are not implemented, agritech startups have to be promoted to make the agri supply chain more efficient. Also, agri startups focused on sustainable modes of farming must be supported.
- Educate in India: With initiatives like Make in India and Aatmanirbhar Bharat, the budget must encourage the creation of educational entities that pick the best brains from schools and colleges, and fund their ventures without any hassles.
Support to modern payments framework – Akash Sinha, Co-founder and CEO, Cashfree
We expect the new budget to include supportive initiatives to provide a modern payments framework that can ensure high-quality performance while gearing up for the next wave of transformation. We are looking forward to RBI’s Regulatory Sandbox, which recently included cross-border payments as the second cohort after retail payments. This move opens up more avenues for fintech as well as offers global expansion opportunities for businesses.
- Clear regulatory frameworks would help in assessing the legality of fintech or verifying compliance/licensing.
- A separate regulatory body would aid in providing transparency in digital payments and also clearly define a framework that caters to unique and new use cases that proliferate as the payment ecosystem matures.
- A discounted MDR for RuPay and slab-based MDR on UPI transactions would help.
- Introduce supportive policymaking that encourages healthy competition and ensures innovation is not curtailed.
Control the cost inflation – Dinesh Chhabra, CEO, Usha International
The recent abnormal surge in the price of raw materials and freight costs cast a shadow on sales forecasts in the forthcoming summer months. We hope that the government will prioritise the measures necessary to control the cost inflation with liberal budget allocation focusing on strengthening the domestic manufacturing and component ecosystem this year.
As digital adoption and transformation accelerates, increased allocation to improve internet infrastructure and connectivity to bridge the rural-urban divide across geographies will also induce strong consumer demand and stabilise growth patterns in the future.
Offer an overall boost to startup economy – Ram Kewalramani, Co-founder and CEO, CredAble
Union Budget 2021 should approach certain structural issues with urgency:
- A big push and budgetary allocation for infusing more liquidity for MSMEs.
- Fortify credit lending to cash-starved sectors and get more lending startups to participate to expand the pie, particularly in the area of working capital financing.
- A big push for the tourism industry to ensure precious foreign exchange reserves are shored up, especially when international tourism is promoted as the pandemic is reigned in.
- While India’s has jumped to the 63rd rank in the Ease of Doing Busineness list, compliances could still be rationalised and processes digitised to a large extent where entrepreneurs with great ideas are motivated enough to start up.
- Push to frame innovative structures where startups can get access to cheaper capital via a fund of more than Rs 10,000 crore, as wishlisted by the Minister of Commerce and Industry recently.
- Enough incentivisation on public-private partnerships.
Special packages for Tier II and III startups – Shivram Choudhary, Founder, Codevidhya
With cooperation from the government, edtech startups have the potential to be global leaders in education. To achieve this goal, the government should release special packages for the startups that are incubated in Tier II and III cities, and allocate budgets for skill development and training that will employ the future workforces.
Continue with the current low interest and easy liquidity regime – Krish Raveshia, CEO, Azlo Realty
The real estate sector has its list ready to boost demand and bring growth back on track. On top of the list are measures like continuing with the current low interest and easy liquidity regime. A low-interest rate is a direct stimulus for investment in real estate. Other demands include:
- Measures to boost demand for the industry like enhancing the limit of deduction under Section 80C of income tax for principal repayment on home loans, a separate exemption for principal repayment on home loans to incentivise investment in real estate.
- The investment of up to Rs 50,000 in REITs should be allowed as a deduction under Section 80C. Also, the holding period for REITs to qualify for long-term capital gain should be reduced from 36 months to 12 months, a step that will spur retail investment in value-creating instruments like REITs.
- Further enhancement in ease of doing business with limited approvals required to develop a project within a defined timeframe.
- Extend the current schemes to avail benefits under PMAY CLSS beyond March 2021, and differential pricing between circle rate and agreement value beyond June 2021 – steps that will boost demand for real estate and help achieve a faster recovery.
Help improve home buying sentiments among consumers – Rajesh Mehra, Director and Promoter, Jaquar Group
‘Revival Push’ is the key expectation from Union Budget 2021. From an affordable housing perspective, corrective measures which ease out the liquidity challenges and improve home buying sentiments will be critical. In respect of this:
- Relief for taxpayers/reduced income tax rates will nurture the spur of demand in the housing sector.
- It will be beneficial to have a limited waiver on GST to aid the pricing burden on property owners.
- Additionally, the GST for sanitary ware and LED/smart lighting is marked at 18 percent and 12 percent respectively – a reduction will be conducive to improved demand and help with the adoption of better consumer habits to gratify the government’s Vocal for Local, Swasth India, and affordable housing for all by 2022 goals.
Stronger efforts to incorporate AI/ML training at early-stage for students – Kartik Sharma, Co-Founder, DcodeAI
There is a need to use low code/no-code tools and usage of AI to make learning easy, intuitive, and personalised. The introduction of such technologies to create a world-class education ecosystem in the country will improve the quality of talent that joins the workforce. The government should make stronger efforts to incorporate AI, ML, and Data Science training sessions at the grassroots level, and build capacities and acumen for new-age tech domains in educational institutions.
Keep skilling a priority – Rameswar Mandali, CEO and Founder, SKILL MONKS
Keeping skilling as a priority, the government must provide training institutions with financial support through Union Budget 2021- 2022, by offering subsidies on basic infrastructural facilities, providing access to low-cost funds backed by an extended moratorium period, and collateral-free loans. A few other expectations include:
- Encourage quality edtech startups and more professionals to get into the skilling domain; the government should look at a tax holiday for the initial two years of operation.
- Boost online training and education by allocating more funds to automate and digitise operations of training institutions.
- Ensure that skilling is prioritised. The government must make provisions for reduced GST slabs, encouraging young graduates and working professionals in getting skilled in a domain of their choice and staying relevant in a dynamic market environment.
- Additionally, the government should look at incorporating additional sanctions to the National Skill Development Corporation (NSDC) to facilitate accelerated learning and to acquire relevant skills under Industry 4.0 domain.
Tax benefits, expansion of HRA provision, and more – Rameesh Kailasam, CEO, IndiaTech.org
The upcoming Budget 2021 is expected to unlock ease of doing business online, which in many ways would unlock economic benefits for the economy. Some recommendations that could enable the same are:
- Relaxation in listing norms for high growth technology companies:
It is critical that certain listing norms are relaxed, especially for high growth technology companies such as unicorns, considering that they have already undergone multiple rounds of capital infusion and due diligence by multiple investors. This is especially the case for relaxation around Minimum Promoters’ contribution and lock-in at the time of direct listing on the Main Board of Stock Exchanges, which can significantly work in retaining such companies to list and create wealth within India.
- Relaxations on the applicability of Section 194 (O):
This section mandates 1 percent TDS levy on all ecommerce transactions. While the section intended to expand the tax base, however, it is creating a significant working capital lock for businesses like travel and insurance, which are regulated sectors having an audit trail and do not allow deductions of such nature. In addition, it has also resulted into a huge compliance burden for online platforms engaging crores of MSMEs, traders, plumbers, electricians, and salons – many of whom may have their taxes deducted despite not crossing the stipulated thresholds due to the multiplicity of platforms they may be providing services to. Therefore, withdrawal of the said provision to regulated sectors and mass population services and its manner of coverage can not only reduce huge compliance cost and working capital lock, but also encourage more sections of the society to come online, aligning with digital India.
- Clarifications on the applicability of Section 206C (1G) (b):
This section mandates the collection of 5 percent TCS with PAN and 10 percent TCS without PAN from the buyer of an overseas travel package from any online ecommerce entity. This provision thus encourages Indian customers to procure from online foreign-based operators since these regulations do not apply to them. Thus, it unfairly subjects honest taxpayers to tax deductions and also creates an uneven level playing field for Indian and foreign travel agents.
- Broad-base ESOP benefits applicability and reconsider point of taxation on ESOPs:
The applicability of the relaxation should be extended ideally to all startups and not be restricted to those registered with the DPIIT or listed under 80-IAC and IMB. Relaxations may be ideal to all startups below a prescribed turnover, and definition for ESOP taxation needs to be relooked as this is a critical tool for boosting ownership by employees, and to attract and retain quality talent for emerging startups. Ideally, abolition of taxation at exercise and levy of only capital gains between the exercise price and sale price at the time of exit is recommended, which could be the basis holding the stock for a prescribed period of time.
- Expansion of the HRA provisions:
Employees are availing HRA for an empty house vs a slightly furnished house benefit from HRA allowance by virtue of a higher rental. However, if someone rents furniture, it is not considered as eligible for HRA for the same house. The furniture rental option is particularly attractive for the large group of young migratory employees who move between cities seamlessly as opportunities open up as the economy expands. It is recommended that necessary amendments be made to Section 10 (13A) of the Income Tax Act and Rule 2A of the Income Tax Rules which would benefit employees to avail an HRA deduction for rented furnishings and household white goods, and at the same time, would unlock startups in this space and significantly boost the furnishing and white goods market.
GST reduction for edtech startups, scholarships for higher education, and more – Sumeet Jain, Co-founder, Yocket
Edtech companies expect help from Budget 2021 for various tax cuts, easier credit access, and other benefits to cope with the COVID-19 pandemic.
- GST reduction in online courses and career counselling: Educational institutions and courses are being taxed 18 percent, which should be reduced to around 5 percent.
- Scholarships for the higher education fund: With the assistance of study abroad scholarships accessible for essentially every course, the government should provide more scholarship opportunities for deserving candidates that can seek help in their determinant decisions for the choice of career courses and university.
- Development in digital courses/online learning: The government should cope with edtech companies to provide technology updates to assist in better online learning and provide effective results. It should set out a special fund for developing online courses. These courses can be provided to the larger public at subsidised rates.
- Preferability for online courses: The government should step in and help in boosting the awareness of online learning courses and promote the online learning platforms.
Increase focus on innovation and IPR in education at the school level – Rajeev Tiwari, Founder, STEMROBO Technologies
Budget 2021 can focus on more comprehensive and extensive methods for our young students in the K-12 segment to get exposure to innovation and tinkering while in school. It is high time Indian students and professionals get a boost in recognition of their innovations via Intellectual Property Rights (IPR). There has to be a culture within the country to promote brain gain.
Considering this, the government had introduced a scheme to develop Atal Tinkering Lab under which around 5,000+ ATL Labs have already been set up. The establishment of thousands of Atal Tinkering Labs across 715 districts of India enabled students from Class VI-XII to learn and experience the tinkering tools and equipment and develop innovative projects to solve community issues. But with 1.5 million+ schools in India, there is still a lot that needs to be done.
Some other expectations include:
Innovation and tinkering-based edtech firms still have to pay 18 percent GST. There should be some provision wherein they need to pay eeduced GST at 5 percent or so.
- Push towards technology-based learning:
The technology-oriented curriculum delivery, based on technique, pedagogy in line with the demands of the 21st-century skills, should be assimilated in our education delivery for K-12 students and schools. Budget 2021 should allow for improved accentuation and discretionary designation to resolve these concerns.
- Enhancing teachers capacity and skill-building:
There is a shortage of millions of teachers in our education system. At the same time, there is a need to update and redesign current teachers’ qualifications so that they can train their aspirants for the demands of the future. Budget 2021 should also include provisions and proposals for teachers’ abilities, taking into account the digital sustainability, development, enhancement, and acceleration of the study patterns.
Increase budget allocation for edtech – Anoop Gautam, CEO and Co-founder, Tinker Coders
The budget allocation for the edtech sector should be increased by at least 7-8 percent, compared to the previous year. Budget 2021 should favour the education sector. Further, the current taxation of 18 percent on the edtech sector can be reduced so that accessible quality digital education becomes a viable option for students of all sections of society.
Establish Fab Lab in India – Abhishek Gupta, Founder and CEO, Hex N Bit
Following steps must be taken to make a startup sector a successful model:
- For electronics manufacturing, there is no Fab Lab in India, so the cost of manufacturing electronic products is higher (as compared to China and other countries) due to high import duties. The only option is to have Fab Lab in India or reduce import duties, making Indian product the most preferred.
- Existing incubators and accelerator programmes must expand their footprint to provide real technical support by connecting them with industry.
- The government must reduce taxes such as dividend tax and capital gains tax which can give investors’ confidence to attract foreign or domestic investment for startups.
Job creation and financial inclusion are the need of the hour – Amit Das, Co-founder and CEO, Think360.ai
- Job creation and business opportunities:
We need a stimulus that drives “creation” and “recovery”; For example, infrastructure financing with downstream impact on various sectors including the unorganised labour and construction and manufacturing-oriented setups.
- Driving financial inclusion:
In addition to creating financing programmes and corpora, we are looking forward to setting up and democratising more information and technology highways that drive financial inclusion and recovery of the bottom-of-the-pyramid segments.
Focus on becoming an AI powerhouse; unlike the previous IT boom where we rode the tailwinds through outsourcing and labour cost arbitrage, we should be focused on leading the AI pack through investments in rural and semi-urban transformative use-cases, building enabling infrastructure, AI parks (on the line of IT parks), beneficial tax regimes, etc.
- Opportunities for startups:
The startup ecosystem needs reforms – such as single window for startup compliances – from labour laws to state and central compliances, shop and establishment acts, digital contracting, payment and dispute settlement system, patents, IPRs, copyrights, trademarks.
- Government compliances and new-age innovations:
The investment corpora being laid out for startups are generous, but their deployment needs to be brought into focus. The process of enabling young entrepreneurial talent through investments, support, and regulatory sandboxes that allow for innovation.
Bring strategic and implementable ideas on board – Dr RB Smarta, Managing Director, Interlink
Strategic and implementable ideas have to be brought on board. Strategically, as it is planned in National Health Policy, 2017, there is an intent of allocating 2.5 percent of the GDP by 2025 on health – from existing 1.3 percent of GDP inclusive of public health is very minuscule compared to OECD countries’ average of 7.6 percent of GDP. Besides making the pharma industry to lead the sector, this budget should address:
- India must get its coveted position in API in the world and PIL like schemes and allocation will reduce imports and increase exports. India will become Aatmanirbhar in APIs.
- Pharma entrenchment in Artificial Intelligence and Machine Learning needs to be promoted and special allocation for pharma startups with time-bound progress should be established.
- As we are take the lead in innovation for vaccines, R&D efforts should be incentivised by showing the results on specific parameters.
- The three major SDGs taken by India needs a lot of push for resources and policy framework.
- The pandemic has shown the fragility of our primary and secondary healthcare systems, and a policy framework is needed in IT-enabled world.
Ease of doing business is the priority – Dhananjay Arora, Founder and CEO, Kwebmaker
As an entrepreneur, the most important area would be the overall ease of doing business, which includes setup and commencement of business, helping garner more employment, job creation, and most importantly, the entire tax structure and rules related to GST, income tax, etc. Given the pandemic, even interests on late tax payments must not be charged (at least for the initial six months from the due date). The tax rules in India are still very complex and most direct and indirect taxes should be abolished in place of fixed transactional tax, which can remove all paperwork and make all processes easy for entrepreneurs and the government.
Stimulus packages, tax incentives for startups in plant-based protein segment – Sagar N Mehta, Founder and Partner, Vegandukan
New-age companies and startups working on sustainability and welfare of human health and developing plant-based proteins should be given special recognition in taxation if we are looking at healthier and more competitive India in a decade to come. The reduction in income tax will prove beneficial for the taxpayer consumer base, which in turn will lead to improved sales in the retail market. We also expect a greater allocation of funds for food processing policies and tax incentives for agricultural and food item exports.
Public-private partnership model in healthtech – Shabnum Khan, Founder, 750ad Healthcare Pvt Ltd
- We anticipate that the government should tap into the public-private partnership model to provide the much-needed support and revamp in the primary healthcare infrastructure in the country.
- We also expect that with a large amount of medical data being made available online, funds must be dedicated towards data protection and developing a secure infrastructure to prevent the misuse of very crucial data available on the databases of several private and government hospitals.
- Additionally, we hope that COVID-19 vaccines will be made available free of cost to the citizens of the country, especially those below the poverty line.
- India should develop as a promising market for generic drugs, and for that, the new Budget must outline the need for conducive policies around this industry. We are expecting that the government will streamline regulations for pharmacies purchasing medications from GST paid channels.
Reduce tariffs and duties on gems and jewellery – Pankaj Khanna, MD and Founder, Gem Selections, Khanna Gems Pvt Ltd
There is a contraction in the gems and jewellery industry in the area of exports and tourist purchase. Our tariffs and duties must be in-line with the international tariff systems and duties, so that we can compete with the neighbouring countries. If the tariffs and duties are reduced, we can be the global leaders in production and trading in gold, diamond, and other commodities in the coming years. Hence, with the opening of trade and exports this year, we are hopeful that the gems industry will see a boom. Also, with new tax laws, we hope that there will be ease for the traders across the country.
Stronger data security and privacy control framework – Vaibhav Lall, Founder, Khojdeal
The Personal Data Protection (PDP) Bill, once passed, is expected to affect all online businesses including ecommerce. It would pave the way for a stronger data security and privacy control framework and guidelines in India. We expect Budget 2021 to provide some clarity about the scope of the legislation and how it will impact ecommerce players so that we have adequate time to upgrade our existing data handling practices.
Focus on building strong IT infrastructure – Kunal Kislay, Co-Founder, Integration Wizards Solution IRIS tech
Budget 2020-21 needs to focus on building a strong IT infrastructure. With the right policy push and resources, the budget can be a real game-changer for the Indian technology sector. Other expectations include:
- Tax filing cycle to increase and GST rebate
- Integration of innovation across multiple sectors like manufacturing, retail, healthcare, etc.
- A concessional fee for small service providers can be proposed
- Strengthening the MSME sector must be the priority
Encourage foreign investments – Puneet Gupta, Founder and CEO at AstroTalk.com
The government has taken steps in favour of young startups and MSMEs, and we expect the same from the budget this year. The centre needs to encourage entrepreneurship, as this is the best way to generate more jobs and progress economically. Startup-friendly policies should be made to easily register a business and provide relaxation in taxes till it reaches a minimum revenue. Make a provision for a collateral-free loan and remove major roadblocks from foreign investments in India.
Increase education budget – Ankit Arora, Founding Director, Saarthi Education
Even though the absolute amount of expenditure on education has increased over the past few years, it has reduced in terms of percentage of GDP. It’s important to see this metric as a percentage of the overall GDP. As the NEP 2020 suggested, the target for education expenditure is 6 percent of the GDP. This might not be possible in just one year. However, the government can show its intent by moving in this direction. The added expenditure can be used to hire more teachers wherever there is a teacher capacity issue, build government schools’ capacity to conduct remote learning, and build a cadre of parent volunteers (just like ASHA Workers) who can mobilise the community and learning at home.
More support for the social sector – Anuradha Prasad, Founder and CEO, India Leaders for Social Sector
We want to see how this budget supports and further strengthens the social sector. Non-profits have operated under extremely difficult circumstances and still delivered. The government should think of ways to ensure the sector is more resilient going forward. The budget should have substantial provisions for providing support and acceleration to the sector. Along with that, the government should provide:
- Clarity on the Social Stock Exchange – Is it only for profit-making social enterprises or for nonprofits as well? How can organisations list themselves on the exchange? What would be the mechanisms of financial exchange?
- Some financial stimulus to the sector in the form of incentivising CSR and individual donations through tax benefits would be a welcome step and would immensely help the sector.
- FCRA amendments came as a sudden shock for the sector in the middle of the pandemic. To prevent such future shocks, the government could form a permanent committee comprising of representatives from the civil society and the government, enabling smooth coordination.
Sustain automobile recovery – Jatin Ahuja, Founder and MD, Big Boy Toyz
While the rest of the automobile sector was financially and economically impacted due to the coronavirus pandemic, the pre-owned luxury car market grew at an unusual pace. The sales recorded a strong sequential recovery post the lockdown as the urban demand and people’s sentiments had a positive influence.
Tier-II and III cities also came forward as the festival season picked up. Going forward, we expect to have continuous government support to sustain the recovery that we have made. Increasing the spending capacity of consumers will help us to regain the lost momentum. Also, initiatives to promote the ‘phygital’ experience (physical + digital) will be appreciated as this is the new normal. Lower taxes, and simplified GST filing must be the aim of this year’s budget. Companies, OEMs, and individuals are expecting the budget to be long-term friendly rather than focusing on just survival.
Support domestic optical industry – Raghavan NS, Country Manager, Essilor South Asia region
We hope for the budget to support the optical industry in eradicating poor vision from our nation. To begin with, a reduction in import duty on raw materials will give a boost to the local manufacturers. Meanwhile, sharp and attractive export incentives to ‘Make in India’ will enable us to compete better. We also look forward to a reduction of personal income tax as this will increase the take-home salary and enable an increase in personal consumption, thereby stimulating demand. In the case of the healthcare sector, we hope for an upgrade of government hospitals, with more tax breaks for R&D and increased coverage of Ayushman Bharat. Also, we look forward to the income tax deduction for CSR expenditure.
Reduce systematic risks within the broking industry – Tejas Khoday, Co-founder and CEO, FYERS
At an individual level, given the unwarranted effect of COVID-19 on the salaried incomes, taxpayers would be relieved to be awarded an upgrade in the personal income tax slabs. That said, given the fiscal situation and the state of direct tax collections, it remains to be seen whether such a relief measure would be possible by the government.
On the stock market front, a lot of regulatory changes were announced by the SEBI over the last few months to reduce systemic risks within the broking industry and to bring in additional transparency. While most stakeholders are acclimatising to these new regulatory changes, the FM can extend support by introducing certain measures, putting the investment and broking community on a strong footing. A few proposals that can bring cheer to retail investors are:
· Abolishing the much-criticised Long-Term Capital Gains (LTCG) tax. This would be a welcome move. A widely-discussed point of note is redefining the concept of ‘long-term’ to two years, and the change of taxation to zero. This would also be a welcome move as it can bring stability to the duration of investments across financial assets.
· Reduction in the quantum of Securities Transaction Tax (STT)/Commodity Transaction Tax (CTT), which has been a long pending wish.
Encourage upskilling – Abhimanyu Saxena, Co-founder, Scaler and InterviewBit
With the new budget, we expect that the government will lower the GST levied on the edtech industry. It is currently at 18 percent, and if it were to go down by even one or two-point, it would have a significant impact – making online education more accessible and affordable.
Another thing that could be implemented is allowing working professionals some tax benefits redeemed against the fees paid for online upskilling courses and programmes. It is a great motivator for professionals to upskill while allowing our nation to build a more diverse talent pool. Further, interest paid on loans for higher education is exempt from income tax. A similar policy can be introduced for loans being taken for online courses as well.
Recognition from apex bodies like UGC, AICTE, and NSDC will also help alleviate digital education and upskilling programmes. All or some of these measures will encourage more working professionals to upgrade their skill levels and knowledge.
Amplify work of charities – Chet Jainn, Founder and CEO, Crowdera
The government should prioritise sustaining the growth that leads to an increase in profitability for the startup sector. As we enter 2021, the focus should be on the ‘Make in India’ initiative and credibility should also be given to ‘Vocal for Local’ campaign to strengthen the economy.
We are also expecting the growth in CSR sector as India Inc needs to support charities to amplify the impact work of Indian NGOs. Measures to keep fraudulent organisations in check is a must and should be made more clear. However, it is very important to incentivise the existing 3.2 million Indian charities to work alongside the government to achieve the charitable and philanthropic goals.
Robust policy and investment intervention – Manish Bhatnagar, Managing Director, SKF India
After the global disruption caused by the coronavirus, the economy is clearly in the revival mode and we are positive that 2021 will be a game-changing year, specifically for the Indian manufacturing sector. The flexible nature of the Indian economy will help expedite the recovery path, however, it needs to be backed by robust policy and investment interventions. We also expect the upcoming budget to address and resolve some of the pain points such as – high costs of raw materials like steel, rise in import freight, IP safety regulations, and labour laws.
Progressive regulations for e-sports – Sai Srinivas, Co-founder and CEO, Mobile Premier League
The effort of NITI Aayog to formulate guidelines for regulating fantasy sports platforms is laudable. With progressive, light-touch regulations in place, India will be well-placed to become a global leader in e-sports – a sector that is likely to create millions of job opportunities. We strongly believe that the self-regulatory body proposed by NITI Aayog should be set up on principles of fairness, transparency and independence, so it can help spur further innovation and ensure a level-playing field for all platforms.
Simplify loan approvals for MSMEs – Tanuja Gomes, Co-founder and co-CEO, Furtados School of Music.
While the onset of the pandemic has caused a lot of disruption, it has also enabled and helped transform the education sector with the maximum usage of digital tools to aid students. With the given focus on education, the entire sector must receive a higher allocation of government budgets, at least 10-12 percent.
The National Education Policy 2020 is a brilliant step forward for the education sector, which focuses on extracurricular and vocational learning integrated with academics. Companies that are focused on education should be encouraged and special tax benefits should be considered for them.
India is home to over 63 million startups, as per the MSME Ministry. The entire loan approval process for MSMEs needs to be simplified and reviewed. Over the last 12 months, we have witnessed a huge inflow of investments, and similarly, we must also review the loans granted to edtech startups through government channels. The edtech sector should also be part of the benefits granted by the government to MSMEs, which will enable a positive impact and promote good education.
Nilesh Shah, Chairman and MD, Atlas Integrated Finance Ltd
With the disastrous effects that COVID-19 has had on everyone`s lives, businesses and the Indian economy, the expectations from the upcoming Union Budget 2021 are sky-high.
As per Section 24 of the Income Tax Act, 1961 an assessee is eligible for an interest deduction of only Rs 2 lakh on the interest paid on housing loans. An increase in this ceiling limit would incentivise home buyers. This coupled with the reduction of stamp duty charges below 5 percent can give a boost to the housing demand and lead to high registrations.
Steps like a reduction of the GST tax rates to 18 percent, introduction of the incentive-based vehicle scrappage policy to scrap over 15-year-old commercial vehicles, local sourcing of automobile parts, and EV incentives for electric vehicle buyers can boost the demand in this sector.
- Travel and tourism industry
The tourism sector needs a revival plan, starting with a reduction in GST to 5 percent, infrastructural developments, creation of tourism sites into world-class tourist destinations, along with easing the visa approval process.
(Disclaimer: This is a rolling story and will be updated as and when more inputs are received from Indian startups, entrepreneurs, and industry experts.)