Finance Minister's third Budget speech managed to enthuse Indian corporate sector. Industry leaders praised the steps to provide tax relief to senior citizens, encourage expenditure for infrastructure development and emphasis on healthcare in Union Budget 2021-22.
Uday Kotak, the Executive Vice Chairman and Managing Director of Kotak Mahindra Bank, hailed the focus on healthcare, infrastructure and financial sectors.
"A Budget for growth with next-gen reforms. Focus on healthcare, infra, financial sector. A stable tax regime, higher borrowings for capex. Specific reforms: disinvestment and monetisation, opening up of insurance, clean-up plan for stressed assets. Sign of a self confident India," Kotak tweeted.
Referring to steps taken in the Budget with respect to financal sector, including setting up a bad bank, new privatisation plan in the sector and rise in FDI limit for insurers, Kotak said "these are bold moves indeed and are expected to buttress the growth recovery process apart from making our financial sector future ready."
FULL COVERAGE: Budget 2021
Mahindra Group Chairman Anand Mahindra welcomed the liberal approach to fiscal deficit target in face of an unprecedented crisis.
"In a time of unprecedented economic stress, the Govt's responsibility was to spend enough to revive the economy or else face enormous human suffering. So I had one expectation from this budget: that we should be very liberal in terms of the targeted fiscal deficit. Box ticked," tweeted Mahindra.
This Budget also saw substantial increase in allocation towards healthcare sector in the backdrop of the coronavirus pandemic. Adar Poonawalla, CEO of Serum Institute of India, stated that the focus on healthcare will help India recover rapidly from COVID-19 pandemic.
"Globally, spending on healthcare infrastructure and vaccine have given countries and their economies the best bang for their buck. Investments in these areas have prevented hospitalizations and resulted in a healthier and more productive workforce, thereby leading to an efficient economy," said Poonawalla. "Therefore we welcome the FM's emphasis on healthcare spending, and immunisation especially for COVID-19 and the pneumococcal vaccines as this will help India recover rapidly from this pandemic. Hopefully, this will also encourage more innovation and expansion in the sector."
Real estate sector was largely left untouched in the Budget, but the push to infrastructure spending and sops for affordable housing have kept the sector hopeful of positive changes.
"Though real estate has not got anything directly from this budget, there are announcements that will indirectly help the sector. Allotment of a massive capital expenditure corpus in order to enhance and support national highway projects, roads and other ancillary infrastructure shows the continued commitment of the government to strengthen connectivity across the country which in turn will largely improve real estate over the next few years," Surendra Hiranandani, Chairman and Managing Director, House of Hiranandani.
"While affordable housing continued to remain a priority area for the government with few additional reforms, the government could have given further boost to real estate which fuels the Indian economy... There have been many pressing concerns in the real sector that have not been addressed such as easing liquidity, reduction in levies/taxes, tax deductions on home loans to give impetus to buyer sentiment, granting of industry status to the overall real estate sector and implementation of single window clearance amongst others," he further said.
Industry players also welcomed the decision to ease tax compliance burden for senior citizens and further measures in Budget 2021 to make tax filing simpler.
"The income tax filing exemption granted to senior citizens, who rely on only pension and interest income, will significantly reduce their tax compliance burden. The announcement of a faceless dispute resolution system should help taxpayers by fast-tracking the resolution process. The pre-filled capital gains and interest income in ITRs will make income tax filing easier for retail investors. Overall, these measures announced in the budget will simplify the lives of small taxpayers and are welcome," said Lalit Keshre, Co-founder and CEO, Groww.
Start-ups had been struggling for the past year on account of disruptions due to the COVID-19 pandemic and had big hopes from the Budget. They lauded the proposal of incorporating one-man companies and other steps that can help the sector.
"The start-up community welcomes the move of FM on proposing the incorporation of one-person companies with no restriction in paid-up capital and turnover, as well as on decriminalization of limited liability partnerships, with the flexibility to convert a company to any form or LLP. This will benefit thousands of start-ups as it will ease the compliance burden," Kapil Jain, Founder of Mumbai-based start-up Graphitto Labs.