Budget 2020: Take a look at reactions from Indian startups, investors, business leaders
Amid resounding calls from the Indian startup ecosystem for tax reforms and measures to boost consumer consumption, Union Finance Minister Nirmala Sitharaman presented her second Budget in the Lok Sabha on Saturday, February 1, emphasising the “paradigm shift” in governance brought in by the Modi-led NDA government.
In her Budget 2020 presentation that laid out the fiscal roadmap for the year ahead, Sitharaman touched upon the impact of goods and services tax (GST) - calling it the most historic economic structuring reform - the proliferation of technology and the rate of digital penetration with broadband and UPI, and the Indian spirit of entrepreneurship.
Here’s a look at what Indian entrepreneurs, startups founders, investors, and other stakeholders from the Indian startup ecosystem had to say about Budget 2020.
Taranpreet Singh, Partner, TASS Advisory:
“This is a budget to boost the income of people and enhance their purchasing power. FM reiterated that GST has been the most historical reform for India and has supported healthy governance objective of the Government. GST supported abolishment of inspector raj faced by the Indian business houses over ages.”
Kunal Bahl, CEO & Co-founder, Snapdeal:
“Thankful to the Hon'ble FM for accepting the startup sector's request for ESOP taxation reforms. Also, the higher time & turnover limits for carry forward of losses for start-ups will enable them to optimize growth decisions in formative years. Overall, Budget 2020 is a thoughtful weaving together of specific proposals to tackle varied issues. Measures to improve access to finance for MSMEs and reduced taxation for the middle-income segment are welcome steps. Boosting physical infrastructure, expanding digital connectivity and growing use of technology in government functioning are important building blocks for the long-term growth of the Indian economy.”
Neelesh Talathi, CFO, Pepperfry
"In the Union Budget announced by the honourable Finance Minister, there are measures and initiatives charted out that will aid consumption growth, particularly when it comes to taxation. In the current macro environment, more money in the hands of consumers through rate cuts, elimination of DDT etc. bodes well. The Finance Minister has also set the tone at the top by being empathetic about No Tax Harassment, resolving litigations etc. Furniture is a $42 million category in India with MSME leading the charge in this industry."
Harshil Mathur, CEO and Co-founder, Razorpay:
"The budget does meet some of the expectations from the FinTech industry and startups. The introduction of some sort of a tax relief on ESOPs was one of the biggest asks from the startup industry - this deferment of tax payment by five years, to me, is one of the biggest welcome moves by the government in this budget. This is a good start and I hope we see more focus on this going forward. Secondly, the reduction on corporate tax to 22% is an encouraging step. This is the lowest in the world and will be encouraging for Indian business. Lastly, the changed income tax slabs and rates is not only a huge income tax relief for individuals but will also lead to an increase in disposable income, thereby giving a boost to consumer spending."
Mitesh Shah, Head of Finance, BookMyShow:
“At the onset, we would like to laud the government for growth driven budget. We welcome the progressive policies aimed at encouraging rural demand, changes in personal taxes spurring consumption and impetus to infrastructure development, measures aimed at bolstering growth and reverse slowdown. Additionally, taxation related on ESOPs as perquisite and removal of DDT are significant moves. However, the benefits of taxation relief on ESOP should be expanded to companies at various stages of growth. "
Saurabh Garg, Co-founder and Chief Business Officer, Nobroker.com:
"We, like the rest of India, welcome Budget 2020 with open arms. The budget is a mixed bag with its positives and misses. In a commendable move, Government has extended support to affordable housing. The Government has extended an additional Rs 1.5 lakh tax benefit on interest paid on affordable housing loans by one year. The extension of one year of Tax holiday on profits of developers involved in affordable housing projects is a clear-cut indication of higher allocation of resources towards affordable housing. This focus on affordable segments comes as a win-win situation for both sellers and buyers."
Indroneel Dutt, CFO, Cleartrip
"The government has backed its vision to turn India into one of the world’s top tourism hubs by allocating Rs 2,500 crore for promoting tourism in general and setting aside a sum of Rs 3,100 crore for the Culture Ministry to boost regional tourism. What would be wonderful is to have an empowered nodal body comprising of the Govt / OTA / airline, hotel and other industry representatives with the objective of promoting discoverability, ease of booking and fulfillment of our cultural, natural and heritage sites. "
Mihir Mehta, Senior Vice President, Ashika Capital Limited:
"The proactive approach of the government in building an ecosystem for budding entrepreneurs is laudable. The provision of funding and setting up an organised platform for the same is a much needed move because financial capital often becomes an impediment for growth and sustainability. I feel we have just touched the tip of immense entrepreneurship potential in India and support from the Government in terms of financial capital will be a major boost"
Lokendra Ranawat, Founder and CEO, WoodenStreet:
“With the focus on economic development, entrepreneurship, which has been the spirit of India is being given high value. A better environment for growth will be provided by opening portals to assist new entrepreneurs. Investment clearance, cells will also be set up to help with the funding process. Electronic manufacturing is in focus and different measures will be taken to enhance the local production. The government will also launch e-marketplaces which will open various opportunities for SMEs. A total of Rs 27,300 crore is also allocated to industry and commerce which will also give a boost to the start-up story in India.”
Sumita Tulsiani, Co-founder & Director, TravelDilSe:
“Startups are being recognised as a strong force behind the aspirational India in today's Budget 2020. As quoted by the finance minister “Entrepreneurship is strength of India.” Setting up a portal based investment clearance cell by the government will uplift the startup ecosystem and will further strengthen India’s position Globally. Given the Entrepreneurial spirit in India, backed by governments support, the startup ecosystem across sectors especially Agriculture & Health care will generate lot of employment opportunities."
Recognition of AI & ML as cutting edge streams, proposal to have full-fledged online degree programmes showcases the vision to position India as a digital nation. The budget also focusses on boosting the tourism sector by developing of 5 archaeological sites as Iconic Sites with museums that will indirectly help startup like ours in the travel technology space to expand our business.
Gaurav Hinduja, Co-founder & Managing director, Capital Float
"The previous year budget brought with itself several welcome moves from the government to boost the cashless economy and the availability of credit for MSMEs. This time also, the budget provides NBFC's like us a strong opportunity to build on these measures and create financial inclusion for MSMEs. The NBFCs have played a pivotal role in the development and delivery of last-mile credit to India and with this amendments made in the Factor Regulations Act, it will help us create more capital flow for MSMEs in India. We are also glad that the government has deferred payment by five years on the issues of taxation on ESOPs."
Harsh Jain, Co-founder and COO, Groww
"The government is clearly pushing manufacturing in the country - an investment clearance cell being set up, scheme to encourage manufacturing of electronics and semiconductor industry products, Rs 27000 crore for industry and commerce is a good measure for the economic boost.”
Agriculture and farming
Divakar Bhalla, Founder of Kesarwala Organic food Restaurant:
“Government’s announcement of focusing towards a more organised farming model with balanced use of fertilisers is a great step for the agriculture and food industry. Online portal on Jaivik Kheti will strengthen the supply chain model on organic produce and encourage farmers, organic food dealers, and end consumers."
“Though government announced about revising incentives for lower use of chemical fertilisers, it is important to specify on the steps the government will take to disincentivise use of chemical fertilisers.
“The reduced dependency on grid connected electricity will be a boon for them as reduced dependency on rain. Rail kisan is another great effort along with geo-tagging warehouses.”
Tikendra Yadav, Founder and CEO, Pepfuels:
"We are pleased that the government has highlighted the importance of the Oil & gas segment and has stressed its focus on infrastructure development. This is a big step in the favor and growth of organisations like us. As compared to last year, this year the government has given a great focus on this industry by announcing Rs 22,000 crore for power, renewable energy in FY21, and expansion of National Gas Grid To 27,000 Km From 16,200 Km. FM’s decision on inviting infrastructure agencies including youth and startup will boost the economy and will eventually help in increasing the economy of businesses and entrepreneurship. It is good that the expectations of the industry have been materialized by the government and we are looking forward to the fast track execution of these announcements."
Vikas Garg, Deputy CFO, Paytm
“We see this budget as a good step in the direction to become a $5 trillion economy. As a technology player embedded in India’s technology ecosystem, we welcome the government’s vision to build Data Centre Parks in the country. The government’s focus on enhanced digital connectivity, and focus on emerging technologies such as machine learning and artificial intelligence, along with the allocation towards quantum computing are sure to provide a fillip to India’s economy.”
Atul Rai, Co-Founder and CEO of Staqu:
“We appreciate the government’s emphasis on promoting cutting-edge technologies in India. In her Union Budget 2020 announcement, the FM observed that technologies like machine learning, robotics, AI, along with a number of productive age group (15-65 years) are cross-cutting streams in India, which is a special attribute for our country.”
We also welcome the proposal of National Police University and the FM making national security a top priority. With our AI-backed offerings in the policing operations, we hope to serve the largest interests of our civil society, ensuring optimum security through AI-backed digital products for policing operations and predictive policing.
Mayank Kumar, Co-founder and MD, upGrad
“The Government has introduced major developments regarding online education and upskilling with the announcement of the 2020 Budget. The Rs 99,300 crore outlay for the education sector in 2020-21 and Rs 3,000 crore for skill development is a significant leap for education institutes and online education providers in India. We believe that upskilling is the critical route to steer India towards becoming a $5 trillion economy."
Minal Anand, Founder and CEO of GuruQ:
"The proposed allocation of Rs 99,300 crore to the education sector for 2020-2021 would surely lead to better infrastructure, attraction of the best teachers and greater research and innovation, especially in the field of science and technology.The proposed online degree program will be instrumental in enabling an even greater number of students to overcome geographical barriers and receive quality education which is imperative for the upliftment of our Nation."
Vivek Jain, Chief Business Officer, Shiksha.com
"The budget gives a good push to our education sector which in turn will help generate employment and boost our economy. The proposed investment in Study in India program will bring more youth from foreign countries and it will be a big step towards the aim of making India the education hub of the world. IND-SAT targets Asian and African countries only but we hope it will open to the whole world soon. Reskilling students and teachers will help us compete internationally."
Krishna Kumar, CEO and Founder, Simplilearn
“It is a fact that India will have its largest working population by 2030 which is a clear indicator for the need to enable the future workforce with the right skills to be job ready. In today’s evolving ecosystem, new age technologies like machine learning, robotics and AI are finding application across sectors, in turn, indicating the need for a skilled workforce. In the current scenario, it is essential that organizations and individuals focus towards investing in skilling."
"We were hoping the government to introduce tax benefits on online skilling courses focused towards working professionals and organisations, along with incentives like tax exemptions for end users and educational institutes.”