On February
1st 2020, India’s Hon’ble Minister of Finance, Smt. Nirmala Sitharaman, will present
the union budget 2020. Union budget plays an important role in determining the
country’s future economic activities and growth. The effects of a government’s
budget on society and the political economy are of considerable concern to
economists as well as to consumers and taxpayers.
1st 2020, India’s Hon’ble Minister of Finance, Smt. Nirmala Sitharaman, will present
the union budget 2020. Union budget plays an important role in determining the
country’s future economic activities and growth. The effects of a government’s
budget on society and the political economy are of considerable concern to
economists as well as to consumers and taxpayers.
Various
Industry leaders and entrepreneurs have their own opinion and expectations from
this year’s union budget.
Industry leaders and entrepreneurs have their own opinion and expectations from
this year’s union budget.
Startup
Terminal presents budget expectations from various industry leaders and entrepreneurs
(Part I).
Terminal presents budget expectations from various industry leaders and entrepreneurs
(Part I).
Kausshal
Dugarr, Founder and CEO, Teabox
Dugarr, Founder and CEO, Teabox
Commenting
on the expectations from Budget 2020 Mr. Kausshal Dugarr – Founder and CEO of
Teabox opines “This year’s budget
is being eagerly awaited by all stakeholders as the need of the hour is to
revive consumer demand which in turn will spur economic growth. To tackle this,
a reduction in personal income tax rates through concessions in tax slabs and
an increase in welfare spends will boost spending. With the dip in foreign
investment currently impacting businesses, steps towards a healthy economy will
improve foreign investor confidence and attract more international investments.
To reduce the burden on business owners, the government should initiate the
simplification of various tax-related compliances and faster processing of tax
refunds.”
on the expectations from Budget 2020 Mr. Kausshal Dugarr – Founder and CEO of
Teabox opines “This year’s budget
is being eagerly awaited by all stakeholders as the need of the hour is to
revive consumer demand which in turn will spur economic growth. To tackle this,
a reduction in personal income tax rates through concessions in tax slabs and
an increase in welfare spends will boost spending. With the dip in foreign
investment currently impacting businesses, steps towards a healthy economy will
improve foreign investor confidence and attract more international investments.
To reduce the burden on business owners, the government should initiate the
simplification of various tax-related compliances and faster processing of tax
refunds.”
Malini
Agarwal – Founder and Creative Director MissMalini Entertainment
Agarwal – Founder and Creative Director MissMalini Entertainment
This
year I suspect the overarching sentiment from all quarters will be for the
government to take steps to immediately stimulate the economy and reverse the
current morass that hangs over the industry.
year I suspect the overarching sentiment from all quarters will be for the
government to take steps to immediately stimulate the economy and reverse the
current morass that hangs over the industry.
We
often think of large, independent unicorn stories when we think of startups,
but the reality is many small and medium-sized enterprises operate downstream
as suppliers to larger corporates. Therefore, I’d like to see policies that
reinvigorate widespread consumer demand and spending, which in turn trickles
down to the startup economy.
often think of large, independent unicorn stories when we think of startups,
but the reality is many small and medium-sized enterprises operate downstream
as suppliers to larger corporates. Therefore, I’d like to see policies that
reinvigorate widespread consumer demand and spending, which in turn trickles
down to the startup economy.
The
most anticipated proposal would be the introduction of new progressive income
tax rates that puts money back into the wallets of everyday consumers,
following the recently implemented corporate tax cuts that have yet to bear
fruit. Without confidence in sustained, robust demand, corporations are
unlikely to reinvest their tax savings and therefore the two must go
hand-in-hand for the benefits to be felt.
most anticipated proposal would be the introduction of new progressive income
tax rates that puts money back into the wallets of everyday consumers,
following the recently implemented corporate tax cuts that have yet to bear
fruit. Without confidence in sustained, robust demand, corporations are
unlikely to reinvest their tax savings and therefore the two must go
hand-in-hand for the benefits to be felt.
Aside
from the demand for their services, startups need capital to build their
enterprises. While VC activity has certainly grown in India, broader access to
funds continues tightening as banks and NBFCs become more risk-averse. Many
promising startups are unable to get off the ground due to simple working
capital constraints. The government should introduce more financial sector
safety nets to mitigate the crippling fear of bad loans, which would help
loosen the purse strings.
from the demand for their services, startups need capital to build their
enterprises. While VC activity has certainly grown in India, broader access to
funds continues tightening as banks and NBFCs become more risk-averse. Many
promising startups are unable to get off the ground due to simple working
capital constraints. The government should introduce more financial sector
safety nets to mitigate the crippling fear of bad loans, which would help
loosen the purse strings.
Lastly,
the tax and regulatory environment need further reforms targeted specifically
at startups. We have certainly seen some progress, perhaps most visibly on the
angel tax issue. And yet too much of an entrepreneur’s time and focus is still
spent ensuring they do not run afoul of regulatory compliances, which can be
obscure and subject to frequent change. Entrepreneurs have enough to worry
about building and scaling a business, and doubly-so in a softer economic
climate. Therefore, any steps that would
streamline compliances would free up a significant amount of entrepreneurial
drive, talent, and energy which is exactly what we need right now.
the tax and regulatory environment need further reforms targeted specifically
at startups. We have certainly seen some progress, perhaps most visibly on the
angel tax issue. And yet too much of an entrepreneur’s time and focus is still
spent ensuring they do not run afoul of regulatory compliances, which can be
obscure and subject to frequent change. Entrepreneurs have enough to worry
about building and scaling a business, and doubly-so in a softer economic
climate. Therefore, any steps that would
streamline compliances would free up a significant amount of entrepreneurial
drive, talent, and energy which is exactly what we need right now.
Shubham Maheshwari, CEO and MD, Being Chef
Feb 1,
2020, is an important date for the startup industry in India. The last quarter
has been really bad for startups because of the slump in the economy. The
setback to the consumption pattern of Indians coupled with a sentiment wave of
the slowdown is the biggest challenge for the startups. We expect our Finance
minister Mrs. Sitharaman to bring some schemes to boost up the spending capacity
of Indian consumers. Also, as the govt decided to go away with Angel Tax for
DPIIT recognized startups like us, we also expect them to bring some policies
for the fast deployment of the Startup India fund to the recognized startups.
Time is the biggest factor in Startup Industry and fast deployment of the fund
with a single-window clearance like what happens in China will help founders to
focus more on the product and future plans instead of struggling for raising
investment to sustain.
2020, is an important date for the startup industry in India. The last quarter
has been really bad for startups because of the slump in the economy. The
setback to the consumption pattern of Indians coupled with a sentiment wave of
the slowdown is the biggest challenge for the startups. We expect our Finance
minister Mrs. Sitharaman to bring some schemes to boost up the spending capacity
of Indian consumers. Also, as the govt decided to go away with Angel Tax for
DPIIT recognized startups like us, we also expect them to bring some policies
for the fast deployment of the Startup India fund to the recognized startups.
Time is the biggest factor in Startup Industry and fast deployment of the fund
with a single-window clearance like what happens in China will help founders to
focus more on the product and future plans instead of struggling for raising
investment to sustain.
Nimish
Trivedi, Co-Founder of Prakriti E-mobility
Trivedi, Co-Founder of Prakriti E-mobility
EV
Industry
Industry
“With
ample renewable energy resources, technology, and an evolving consumer mindset,
the Indian Electric Vehicle (EV) industry is on the cusp of great innovation.
We believe that 2020 can be the year when EVs go mainstream. Last year’s budget
witnessed the government pushing the segment with multiple initiatives – be it
lowering the GST on EVs or providing additional tax deductions on EV loans. We
hope that the momentum continues in 2020, as the focus needs to shift from just
selling to overall sustainability. In the upcoming budget, we hope to see
reductions in road and registration taxes for EV taxi aggregators so that they
are able to develop viable public transportation alternatives. We also hope for
special permissions and reduced charges for EV aggregators for operating with
kiosks around major hubs such as the airport, metro and railway stations.
Promoting and encouraging widespread expansion of charging infrastructure is
another key agenda item that the budget needs to address. These steps, coupled
with incentives for faring passengers in EVs, will level the playing field for
EV industry to compete with traditional auto players. As per an industry
report, India has the potential to become one of the largest EV markets in the
world and these initiatives will give the much-needed push towards this
goal.”
ample renewable energy resources, technology, and an evolving consumer mindset,
the Indian Electric Vehicle (EV) industry is on the cusp of great innovation.
We believe that 2020 can be the year when EVs go mainstream. Last year’s budget
witnessed the government pushing the segment with multiple initiatives – be it
lowering the GST on EVs or providing additional tax deductions on EV loans. We
hope that the momentum continues in 2020, as the focus needs to shift from just
selling to overall sustainability. In the upcoming budget, we hope to see
reductions in road and registration taxes for EV taxi aggregators so that they
are able to develop viable public transportation alternatives. We also hope for
special permissions and reduced charges for EV aggregators for operating with
kiosks around major hubs such as the airport, metro and railway stations.
Promoting and encouraging widespread expansion of charging infrastructure is
another key agenda item that the budget needs to address. These steps, coupled
with incentives for faring passengers in EVs, will level the playing field for
EV industry to compete with traditional auto players. As per an industry
report, India has the potential to become one of the largest EV markets in the
world and these initiatives will give the much-needed push towards this
goal.”
Start-up
and Entrepreneurship
and Entrepreneurship
“The
start-up ecosystem in India has come a long way since the launch of Start-up
India in 2015. From the upcoming budget, we hope for incentives that will help
increase the success rate of start-ups in India. Incentives such as easier tax
compliance to support budding and existing entrepreneurs, extension of tax
incentives to incubators and tax benefits on ESOPs are certain measures that
will help entrepreneurs maintain cash flow, acquire talent and eventually, help
achieve better valuation and funding. We also hope to see incentives for
futuristic and innovative technologies such as Electric Vehicles, Artificial
Intelligence, and Green Technology as these will form the backbone of a
technology strong India, helping become a $5 trillion economy by 2024.”
start-up ecosystem in India has come a long way since the launch of Start-up
India in 2015. From the upcoming budget, we hope for incentives that will help
increase the success rate of start-ups in India. Incentives such as easier tax
compliance to support budding and existing entrepreneurs, extension of tax
incentives to incubators and tax benefits on ESOPs are certain measures that
will help entrepreneurs maintain cash flow, acquire talent and eventually, help
achieve better valuation and funding. We also hope to see incentives for
futuristic and innovative technologies such as Electric Vehicles, Artificial
Intelligence, and Green Technology as these will form the backbone of a
technology strong India, helping become a $5 trillion economy by 2024.”
Amit
Gupta, CEO & Co-founder at Rapyder
Gupta, CEO & Co-founder at Rapyder
We are
optimistic about the country’s economic growth as he foresees better days
compared to the current slowdown. He said, “India, no doubt continues to
remain the software development hub for the world. More hurdles in the path of
MSME growth would be removed as I foresee a significant relaxation in the
lending aspects for MSMEs to survive the current economic changes. Government
could relax some of the compliances, which were mandatory earlier. It will also
address the issue of delayed payments to MSMEs. The ecosystem of MSME lending is
set to see significant transformation. Thanks to better access to authentic
data from various credible sources that provide a better understanding of the
nature of the specific business, its growth potential and profits. Government
will become even more citizen friendly, by providing a boost in consumer
confidence with lowering personal income tax in the coming budget. This is in
turn is expected to fuel demand of goods and services, leading to
consumer-spending more for buying and consumption.
optimistic about the country’s economic growth as he foresees better days
compared to the current slowdown. He said, “India, no doubt continues to
remain the software development hub for the world. More hurdles in the path of
MSME growth would be removed as I foresee a significant relaxation in the
lending aspects for MSMEs to survive the current economic changes. Government
could relax some of the compliances, which were mandatory earlier. It will also
address the issue of delayed payments to MSMEs. The ecosystem of MSME lending is
set to see significant transformation. Thanks to better access to authentic
data from various credible sources that provide a better understanding of the
nature of the specific business, its growth potential and profits. Government
will become even more citizen friendly, by providing a boost in consumer
confidence with lowering personal income tax in the coming budget. This is in
turn is expected to fuel demand of goods and services, leading to
consumer-spending more for buying and consumption.
Shailesh
Shah, Co-founder at Strata Consulting
Shah, Co-founder at Strata Consulting
India
needs to garner over $10 trillion to get its urban infrastructure going in the
correct direction. We need relevant,
innovative and bold policy interventions to help make this happen. In the short
term, we need to foster exports and domestic consumption while we start
thinking beyond taxes the way we currently are to balance budgets. The
Insolvency and Bankruptcy Code is a step in the right direction but is in its
infancy in comparison to the depth and width the nation needs to resolve
thousands of cases and trillions of rupees. As a nation, we need to commit to
monetary policy that helps align inflation and interest rates to massive
growth.
needs to garner over $10 trillion to get its urban infrastructure going in the
correct direction. We need relevant,
innovative and bold policy interventions to help make this happen. In the short
term, we need to foster exports and domestic consumption while we start
thinking beyond taxes the way we currently are to balance budgets. The
Insolvency and Bankruptcy Code is a step in the right direction but is in its
infancy in comparison to the depth and width the nation needs to resolve
thousands of cases and trillions of rupees. As a nation, we need to commit to
monetary policy that helps align inflation and interest rates to massive
growth.
Dr
Vaibhav Kapoor, MBBS, MS & Co-founder at Pristyn Care
Vaibhav Kapoor, MBBS, MS & Co-founder at Pristyn Care
As a
startup trying to increase the accessibility and affordability of minimally
invasive surgical technologies beyond the confines of corporate hospitals in
Tier-1 cities to Tier-2 and Tier-3 cities, we could benefit a lot from
partnerships with the government. Existing infrastructure of government
hospitals, coupled with experienced surgeons and latest technology from the
private sector can go to great lengths in ensuring that the vast majority of
the population, that was previously bereft of the benefits of quality secondary
care, can now be guided on the path to health. As the largest and sole provider
of Laser General Surgery treatments in India through Ayushman Bharat, Pristyn
Care has already taken steps in this regard to extend the benefit of Government
schemes through a hassle-free patient experience, but now the Government must
also include provisions for such partnerships in the upcoming Union Budget.”
startup trying to increase the accessibility and affordability of minimally
invasive surgical technologies beyond the confines of corporate hospitals in
Tier-1 cities to Tier-2 and Tier-3 cities, we could benefit a lot from
partnerships with the government. Existing infrastructure of government
hospitals, coupled with experienced surgeons and latest technology from the
private sector can go to great lengths in ensuring that the vast majority of
the population, that was previously bereft of the benefits of quality secondary
care, can now be guided on the path to health. As the largest and sole provider
of Laser General Surgery treatments in India through Ayushman Bharat, Pristyn
Care has already taken steps in this regard to extend the benefit of Government
schemes through a hassle-free patient experience, but now the Government must
also include provisions for such partnerships in the upcoming Union Budget.”
K G
Prabhu Group CFO, Smartlink Holdings Ltd.
Prabhu Group CFO, Smartlink Holdings Ltd.
As
India is gradually moving forward on the path of digitization, for Union Budget
2020, government should focus on giving a strong push to the initiatives that
will drive the process of digital adoption across various sectors. We are
expecting that the upcoming budget will have measures to encourage domestic manufacturing
by introducing polices that will allow global companies to collaborate with
Indian companies and manufacture in India.
India is gradually moving forward on the path of digitization, for Union Budget
2020, government should focus on giving a strong push to the initiatives that
will drive the process of digital adoption across various sectors. We are
expecting that the upcoming budget will have measures to encourage domestic manufacturing
by introducing polices that will allow global companies to collaborate with
Indian companies and manufacture in India.
Rachit
Chawla, Founder & CEO, Finway
Chawla, Founder & CEO, Finway
Better
liquidity and sector-specific incentives to MSMEs should be the top priorities
of the Finance Minister in the Union Budget 2020-21. 6.5 per cent GDP growth in
the coming fiscal is not a formidable task once liquidity resurges and
conditions of MSMEs get improved. There is a strong connection between the
health of NBFCs and health of MSMEs. The financial goals of the latter depend a
lot on the financial stability of the former, and their collective growth is an
index to economic growth. IL&FS and DHFL crises bring drastic repercussions
on India’s financial markets and MSMEs, the back-bone of Indian Economy are
still bearing the brunt of reduced liquidity in the market.
liquidity and sector-specific incentives to MSMEs should be the top priorities
of the Finance Minister in the Union Budget 2020-21. 6.5 per cent GDP growth in
the coming fiscal is not a formidable task once liquidity resurges and
conditions of MSMEs get improved. There is a strong connection between the
health of NBFCs and health of MSMEs. The financial goals of the latter depend a
lot on the financial stability of the former, and their collective growth is an
index to economic growth. IL&FS and DHFL crises bring drastic repercussions
on India’s financial markets and MSMEs, the back-bone of Indian Economy are
still bearing the brunt of reduced liquidity in the market.
A
large number of MSMEs are struggling with financial challenges, and without
special subsidies, their sustenance is difficult. It is very much shocking that
out of 6.33 crore MSMEs in India, only 0.05 lakh are medium enterprises, and
they usually deprive of Public Procurement Policy which mandates 25 per cent
procurement from MSEs. They are also barred from availing delayed payment
reliefs through facilitation councils. So, to revamp the economy, the Finance
Minister should take adequate measures which may empower the NBFCs and
consequently ensure better prospects for the MSMEs.
large number of MSMEs are struggling with financial challenges, and without
special subsidies, their sustenance is difficult. It is very much shocking that
out of 6.33 crore MSMEs in India, only 0.05 lakh are medium enterprises, and
they usually deprive of Public Procurement Policy which mandates 25 per cent
procurement from MSEs. They are also barred from availing delayed payment
reliefs through facilitation councils. So, to revamp the economy, the Finance
Minister should take adequate measures which may empower the NBFCs and
consequently ensure better prospects for the MSMEs.
Shubh
Bansal, Co-Founder, Truebil
Bansal, Co-Founder, Truebil
“We
have Strong expectations from the Union budget when it comes to reduction in
GST charges as it will encourage foreign investors to invest more in Indian
startups. One of the biggest steps from the Indian government in tax norms has
been the relaxation of the angel tax for the startups registered.
have Strong expectations from the Union budget when it comes to reduction in
GST charges as it will encourage foreign investors to invest more in Indian
startups. One of the biggest steps from the Indian government in tax norms has
been the relaxation of the angel tax for the startups registered.
A reduction
in personal income tax is necessary as it will put more money in the hands of
the consumer. The assumption being that this extra money would then be spent on
buying goods and/or services, thereby stoking demand.”
in personal income tax is necessary as it will put more money in the hands of
the consumer. The assumption being that this extra money would then be spent on
buying goods and/or services, thereby stoking demand.”
Aurko
Bhattacharya, Co-Founder, ePayLater
Bhattacharya, Co-Founder, ePayLater
“Financial
inclusion remains a critical concern, and digitization has the potential to
effectively address the same. This can be achieved by taking steps to promote
digital payments and improve the supporting infrastructure for digital
payments. The Government should introduce budgetary concessions for digital
transactions and thereby reduce dependency on cash.
inclusion remains a critical concern, and digitization has the potential to
effectively address the same. This can be achieved by taking steps to promote
digital payments and improve the supporting infrastructure for digital
payments. The Government should introduce budgetary concessions for digital
transactions and thereby reduce dependency on cash.
The
digital lending industry has been playing a very important role in accelerating
financial inclusion, helping India transition from a cash economy to a digital
economy. Thus, digital lending needs to be given a boost. Tax benefits are
needed for regulated entities involved in digital lending. We expect the
government to usher in a new set of reforms in the upcoming budget and hope for
higher tax relief, and further clarity on Aadhaar based eKYC.
digital lending industry has been playing a very important role in accelerating
financial inclusion, helping India transition from a cash economy to a digital
economy. Thus, digital lending needs to be given a boost. Tax benefits are
needed for regulated entities involved in digital lending. We expect the
government to usher in a new set of reforms in the upcoming budget and hope for
higher tax relief, and further clarity on Aadhaar based eKYC.
At the
same time, a push on security standards for various platforms offering
financial services would be necessary for people to gain confidence in dealing
with digital currency. The introduction of RBI sandbox comes across as a
positive development made in this sphere, and the FinTech industry expects more
such policies and reforms this year.”
same time, a push on security standards for various platforms offering
financial services would be necessary for people to gain confidence in dealing
with digital currency. The introduction of RBI sandbox comes across as a
positive development made in this sphere, and the FinTech industry expects more
such policies and reforms this year.”
Karishmma
V Mangal Director and Trutee Thakur International School Cambridge
V Mangal Director and Trutee Thakur International School Cambridge
“The
education sector featured prominently in Honourable Finance Minister, Nirmala
Sitharaman’s, maiden budget in 2019 which was quite encouraging. I believe that
further reforms in the education policies in the 2020 budget, will be
favourable for the sector. To support and strengthen Indian education;
initiatives, schemes, and policy inform should be implemented that promote
India as an emerging global education hub and improve the overall quality of
education within the country.
education sector featured prominently in Honourable Finance Minister, Nirmala
Sitharaman’s, maiden budget in 2019 which was quite encouraging. I believe that
further reforms in the education policies in the 2020 budget, will be
favourable for the sector. To support and strengthen Indian education;
initiatives, schemes, and policy inform should be implemented that promote
India as an emerging global education hub and improve the overall quality of
education within the country.
I
support the highlight and landmark development of the 2019 budget which was the
introduction of the New National Education Policy. However, I hope in 2020, the
government will strive to bring about critical changes by addressing certain
pain points including research and innovation, global visibility, quality
faculty, and technology.
support the highlight and landmark development of the 2019 budget which was the
introduction of the New National Education Policy. However, I hope in 2020, the
government will strive to bring about critical changes by addressing certain
pain points including research and innovation, global visibility, quality
faculty, and technology.
Most
education entrepreneurs like me are hoping that the scope of higher education
in India will be radically reformed. I believe that the idea should be to focus
on better academic outcomes.
education entrepreneurs like me are hoping that the scope of higher education
in India will be radically reformed. I believe that the idea should be to focus
on better academic outcomes.
Rather
than only focussing on imparting knowledge and learning to students, it’s high
time we make them industry ready which is only possible by improving facilities
in educational institutions by setting up smart classrooms and modern research
facilities, and making artificial intelligence, robotics, augmented reality,
virtual reality, and Internet of Things (IoT) a part of student learning
programs.
than only focussing on imparting knowledge and learning to students, it’s high
time we make them industry ready which is only possible by improving facilities
in educational institutions by setting up smart classrooms and modern research
facilities, and making artificial intelligence, robotics, augmented reality,
virtual reality, and Internet of Things (IoT) a part of student learning
programs.
Besides
reforms in the overall quality of education for students, faculty training
should be made mandatory too. The country has roughly 8.5 million teachers and
only 19,000 teacher training institutions. Teacher counselling programs should
aim at training teachers to address the current learning needs of the students.
reforms in the overall quality of education for students, faculty training
should be made mandatory too. The country has roughly 8.5 million teachers and
only 19,000 teacher training institutions. Teacher counselling programs should
aim at training teachers to address the current learning needs of the students.
Lastly,
subsidising education loans is also the need of the hour as the funds given by
banks for students looking to study abroad is too low considering the cost of
education.”
subsidising education loans is also the need of the hour as the funds given by
banks for students looking to study abroad is too low considering the cost of
education.”
(Views expressed are of different industry leaders. Email us your feedback at startupterminal@gmail.com)
