Budget 2024: Industry leaders assess India’s path to growth and innovation

The Union Budget 2024-25 presented by Finance Minister Nirmala Sitharaman is a significant step towards realising the vision of ‘Viksit Bharat’. The Union Budget focuses on fiscal consolidation and targets a fiscal deficit of 4.9 per cent of GDP. Key allocations include significant funding for infrastructure, rural development, employment and skilling initiatives. Significant policy changes include the abolition of angel tax for startups and promotion of investment and innovation. The Budget emphasises technology by increasing funding for research and development, as well as prioritising digital infrastructure and women’s development, with strong support for SMEs and entrepreneurship.To better understand the impact of the budget, here are some reactions from industry experts:

Nemesisa Ujjain, Vice President and Head of The Circle FC, noted the budget’s solid foundation for economic growth, investment and capital formation. Increased tax deductions, increased Mudra loan limits and SME relief are expected to boost entrepreneurship. Reduction in tax on foreign companies from 40% to 35% is expected to attract higher FDI, creating new growth opportunities.

Karan Verma, Co-Founder and Director, FAAD Network, highlighted the Budget’s commitment to economic stability and growth. He highlighted the introduction of a new ₹5,000 crore fund to support innovation and extend tax breaks for startups. The creation of a ₹1,000 crore venture capital fund for the space economy demonstrates a far-reaching vision, positioning India as a leader in this emerging sector. These measures are expected to provide a significant boost to the startup ecosystem, supporting innovation and long-term growth.

Vijay Navaluri, Co-founder and Chief Customer Officer at Supervity, praised the Budget for its strong focus on technology and innovation. The removal of angel tax for investors is expected to significantly strengthen the startup ecosystem, supporting greater investment and innovation. The allocation for R&D, especially in the space economy and renewable energy, underlines the government’s commitment to supporting cutting-edge technologies. Supervity AI expects these developments to propel India towards becoming a global technology leader. Shashank Saurabh, Co-founder and CEO of QUE, expressed enthusiasm about the Budget’s support for digital and infrastructure development. The removal of angel tax and focus on digital public infrastructure are in line with QUE’s mission to leverage digital advancements. The Budget’s emphasis on women’s development and significant allocation for programmes benefiting women and girls are in line with QUE Universe’s ethos of empowering women. Anubhav Dubey, Co-Founder, Chai Sutta Bar, highlighted the budget’s commitment to rural development, which is key to improving connectivity and expanding markets. The special focus on SMEs and initiatives to support entrepreneurship are seen as positive steps that will benefit the startup ecosystem and the broader economy. Sajju Jain, an entrepreneur, startup coach and Harvard Business School graduate, hailed the removal of angel tax as a positive step. He welcomed the allocation of Rs 2 lakh crores for job creation and skill development, especially through internships in top companies. However, he noted that direct support for startups in the budget remains limited and continued support will be necessary to build long-term capabilities and capacity.

Mr. Soumya Sarkar, Co-Founder, Wealth Redefine (AMFI MFD registered), praised the government’s fiscal discipline, highlighting the fiscal deficit target of 4.9% of GDP. The budget’s focus on infrastructure, rural development, employment and skilling initiatives promises to boost growth and create opportunities. The removal of angel tax for startups is seen as a key boost for the entrepreneurship ecosystem. However, the proposed tax hike on short-term and long-term capital gains may dampen investor sentiment despite the simplification of capital gains taxation.

Gautam Madhavan, Founder and CEO of Mad Influence, welcomed the budget’s focus on growth and innovation support. The push for digital public infrastructure and the removal of the angel tax are intended to empower digital creators and influencers, supporting a vibrant and sustainable digital economy.

Arun Alagappan, Executive Chairman, Coromandel International Limited, said, “The government’s commitment to bring 1 crore farmers into organic farming and promote large-scale horticulture production in the next two years will significantly boost agricultural productivity and sustainability. The establishment of the proposed 10,000 demand-based bio-input resource centres will help make organic farming more accessible to Indian farmers. Moreover, the focus on strengthening production, storage and marketing of pulses, along with funding for shrimp farming, demonstrates a holistic approach to supporting diverse agricultural activities. The allocation of ₹1.52 lakh crore for agriculture and allied sectors is a clear indication of the government’s commitment to transform this critical sector,” he said.

He added that the government’s plan to implement digital monitoring of kharif crops in 400 districts, as well as make 109 weather-resistant seeds available, will accelerate innovation and efficiency in farming practices.

Priyadarshi Nanu Pany, Founder and CEO, CSM Tech, believes that the budgetary emphasis on SMEs varies greatly when it comes to the challenges and potential of the sector.

“Credit-focused measures — including a new guarantee program, stress relief, and a digital footprint-based assessment model — have the potential to revolutionize SME financing. By reducing reliance on collateral and traditional metrics, these initiatives promise to unlock capital for a broader range of businesses, potentially catalyzing growth and job creation. The expansion of TReDS and SIDBI’s reach demonstrates a commitment to improving liquidity and financial inclusion across SME clusters,” he said.

Overall, the Union Budget 2024-25 is seen as a forward-looking initiative that aims to boost growth, support innovation and improve the ease of doing business in India. The government’s commitment to infrastructure, technology and rural development, along with fiscal discipline, sets a positive tone for India’s economic trajectory in the years to come.