Budget 2023: What new age companies’ wishlist looks like

As Finance Minister Nirmala Sitharaman gets ready to present the Union Budget for 2023-24 on February 1, the industry is hoping for measures to be announced that will fuel overall economic growth. Budget 2023-24 is an important one as it comes a year ahead of the Lok Sabha elections in 2024, and also as it comes amid a global slowdown and several geo-political tussles.

While 2022 was a year of recovery after two years of Covid disruptions, the industry is looking forward to consolidating the gains from 2022 this year and witnessing growth across sectors. With global recession looming, all eyes are on how the government plans its expenditure and controls fiscal deficit and inflation.

Adgully reached out to leaders across the industry to know more about their expectations, predictions and wishlists for the Union Budget 2023-24.

Rajesh Ramakrishnan, Managing Director, Perfetti Van Melle India:

“One of the key expectations from Union Budget 2023 would be to fuel growth in the rural markets through a slew of initiatives around increased stimulus packages to boost farm income and greater number of infrastructure projects. Adequate investment in infrastructure, agriculture and social sectors will drive the pace of growth in the coming quarters. A key task for the Budget 2023 would be to develop sustainable growth models for increasing rural income so that there is a heightened demand for consumer products leading to a virtuous growth cycle.”

Sanjay Vakharia, CEO & Co-Founder, Spykar:

“The current atmosphere seems to be a little in a flux with so much conversation around global recession and inflationary pressures. While we expect the government to create the environment conducive to help our industry meet these challenges coming straight out of 2 years of pain caused by COVID, in the forthcoming budget. The volatility which the fluctuation in the cotton prices created in the past was very unsustainable for the industry. Hence, a mechanism whereby a Cotton Price Stabilization Fund can be set up to help the industry meet recurrence of the same and set up a fund to promote Traceability and Sustainability in Textile Value Chain. In the context of global warming and containing waste and landfill, this would go a long way to help reduce and fight the menace of the above.”

Greg Moran, CEO and CoFounder, Zoomcar:

“The automobile sector has been through numerous ups and downs in recent years. In this year’s Union Budget, the government must renew its focus on enhancing infrastructure to make the production and usage of EVs and EV-related features, like charging stations, easier. The best alternative and most plausible solution for those seeking eco-friendly and sustainable commute options, apart from EVs, would be to rent cars. The government must encourage people to make sustainable choices when it comes to commuting. Renting an EV would be ideal for a majority of the population that wishes to own a car without the commitment and additional costs. We are hoping for the car rental sector to grow further and this progress is significantly reliant on the budget.”

Yeshasvini Ramaswamy, Serial Entrepreneur & CEO, Great Place To Work India:

“The upcoming Union budget will be the last full year budget from the present government and I do have high expectations from it. While India’s domestic growth projections looks promising, we are surrounded by geo political uncertainties, high inflation and slowing world economic growth. I am expecting the budget to incentivize employment generation both in formal and informal sectors as we need to make most of our demographic dividend. More measures to boost start-ups specifically in areas of agri tech, new age tech like IoT, AI, AR, energy and fin tech will continue. The start-up eco-system will definitely look forward to some bold measures around tax reliefs easing investments on growth funding and reforms to support Indian businesses go global.

With hybrid workplaces and the gig economy picking up, I am expecting some new legislation that may want to promote equitable practices. The four labour codes – the Code on Wages, Industrial Relations Code, Social Security Code and the Occupational Safety, Health and Working Conditions Code are set to replace the existing 29 labour laws. Over 90 per cent of India’s 50 crore workers are in the unorganised sector. And through these codes, the government will be able to ensure that all of them enjoy the benefits of labour laws related to minimum wages and social security. Despite the approval of these codes by the Parliament in 2020, many of the State Governments are yet to adopt the New Labour Codes. A few simplified mechanism needs to be included in the Budget for FY 2023–24 for the adoption of these codes.

The Budget should also provide some changes in the income tax structure. The tax rates have not been considered for revision since FY 2017-18 and this budget may be an ideal time for revisions that will enable more purchasing power and to provide some tax relief. The ‘middle class’ and the ‘lower middle class’ have been impacted to a large extent due to the impact of Covid-19 for two consecutive years and pursuant to the global inflation, conditions are difficult. Their expectations maybe the highest from the current dispensation. While India features among the higher category of a tax country, the follow through on social security still remains a long road to be travelled.

India cannot progress and prosper without the meaningful contribution of its women. There has to be a course correction of many fronts and for me personally I will look forward to more protection, benefits for women employees and ease of legislation to promote women entrepreneurs especially the semi urban and rural areas of India with a specific call out to technology, energy and the agricultural sectors.”

Akshay Varma, Co-founder, Beco:

“The sustained headwinds from the Covid-19 pandemic, amplified by the conflict between Russia & Ukraine made 2022 a testing year across industries as the global supply chains were massively disrupted and brought to a halt, while also resulting in a substantial hike in prices. Despite these global circumstances, it is heartening to see India’s booming start-up ecosystem, and the government’s sustained emphasis on catalysing its growth. The dual approach of insistence on domestic manufacturing and the corresponding policy implementations will be sure enablers in steering the Indian D2C market in an upward trending direction. In this regard, the upcoming Union Budget 2023 will be pivotal in redefining the trajectory for the growth of the Indian economy, especially in a post-covid world.

To start with, our 100+ unicorns, who have collectively raised $130 billion since 2014, are already paving way for new-age start-ups like ours to gain investor and consumer confidence in supporting dynamic shifts towards purpose-driven green agendas.

With the latest budget, there are high expectations for meaningful provisions to foster a greener start-up economy, and this could be achieved through policy incentives that are conducive to sustainable business models, increased R&D support as well as technical upliftment for innovation in the green-goods space. As India enters its decade of sustainability, certain funding and policies to tackle tariff rate challenges and project execution will definitely boost the consumer sentiment.”

Nishant Pitti, CEO and Co-founder, EaseMyTrip:

“There are several tenets of the industry which are expected to benefit from the upcoming budget session. The entire travel and tourism industry is still in the process of recuperating from the major blow that it faced when Covid-19 struck. As the pandemic becomes endemic, it is important for both the central and state governments to work in tandem to facilitate this sector and support it. For starters, the government could include travel and tourism in the concurrent list to provide it with industry status, which will help in making it more structured.

A greater focus on the industry’s revival is required, which can be done by implementing an e-visa fee waiver for tourist visas, and domestic income tax travel credit for Indian citizens and Indian companies. The Emergency Credit Line Guarantee Scheme (ECLGS) should also be extended to tourism and hospitality. In addition to this, we are also hoping that with the upcoming budget, the government will strive to increase the disposable income of the middle classes to aid the rise of discretionary spending. This can be done by taking concrete steps to improve the cash flows, enable access to easy credit, and reduce the income tax rates and GST tax rates.”

Sunil Gupta, MD & CEO, Avis India:

“Travel and tourism have always been important contributors to the country’s GDP. During Covid, this sector was among the worst affected and is still far from pre-Covid levels. It is also a big generator of employment and in the current context of high unemployment, supporting this sector will pay rich dividends to the economy. It, therefore, behoves the government to give a special thrust to this sector. The upcoming Union Budget offers the government the perfect opportunity to do so by formulating provisions that aid the sector to recover from the losses it has borne during the last couple of years. As a travel-oriented business, we expect higher budgetary allocation to infrastructure to promote travel. We are also looking forward to the government granting industry status to the travel and tourism sector, which will help in the regularisation of policies and processes and better access to finance. Measures like rationalisation of taxes, reduction in indirect taxes and related exemptions could also benefit the sector to a great extent by creating a favorable environment for people to spend their disposable income on travel. The introduction of soft loans with lucrative terms can also act as a stimulant for the sector, which is still on its journey to post-pandemic revival. We expect that the upcoming budget announcement will lead the sector towards a period of prosperity.”

Dhruv Sawhney, COO & Business Head, nurture.farm:

“More than 50% of the population in India depends on agriculture for their livelihoods. Agriculture is also the 3rd most significant contributor to our GDP and will always attract attention in the union budget.  However, unlike previous years, we are moving into 2023-24 with a cautious & uncertain outlook owing to challenges like a looming recession, the Russia-Ukraine war, threats of climate change, falling export numbers, global inflation in crude, edible oil, and wheat prices.  A separate budget allocation to improve crop production efficiency and enhancement of the supply chain can improve benefits to the farmers.”

Hiranmay Mallick, CEO & Co-Founder, Tummoc:

“2022 was a year of tremendous progress in transit and mobility. There was a significant spike in digital adoption, and a number of new MaaS players entered the market, a large portion of which were EV players. In 2023, transit in India is going to significantly level up, with seamless solutions transforming the way our daily commuters get around. I can say with confidence that in 2023, a number of Indian metropolitans will get access to a seamless solution to inaccessibility to information, first and last-mile connectivity and the need for digital ticketing. Without getting into too much detail, a revolutionary solution is being built at the moment and will transform mobility in India very soon. To facilitate this progress, there are certain expectations and hopes from the coming year's budget such as incentivizing initiatives that promote last-mile connectivity, recognition programs for sustainable/ public transport start-ups to encourage better relationships, carbon trading programs/ funds to promote shared and sustainable mobility, incentives for retrofitting conventional vehicles to electric vehicles, etc.”

Sravan Appana, CEO, iGowise Mobility:

“The union government has been consistently proactive in creating policies for rapid adoption & indigenization of sustainable mobility alternatives for urban air-quality and climate resistance. These new-age sustainable vehicles come with smart connected features that provide us the opportunity to combat a couple of more crucial sticky problems. Road accidents & Traffic decongestion! Following the national road safety awareness week in January, it is time for sweeping reforms for safer mobility especially for two-wheeler users who are 30 times more prone to road related fatality. 2W are not just a medium of transport, but also a medium of livelihood for 90% of the Indian households. Vehicle telematics, 5G communication, crowd-sourcing data, AI powered analytics etc. provide opportunities to encourage better ride behaviour and to identify infrastructure fault lines.

Advanced drive assistance systems provide help in predicting & preempting accidents. Promoting state-of-the-art automobile engineering technologies can help in safer & more stable bikes & scooters. Size & occupancy based congestion road tax models encourage lighter, slimmer & low footprint vehicles for urban commute. Self-driving auto-summon technologies help enable shared mobility for optimal vehicle utilisation & traffic decongestion. India can quickly transform itself from having the most deaths on roads to one of the safest by implementing few simple low-hanging yet path-breaking reforms.”

Shalu Jha, Co-founder & COO, PRandit Solutions:

“For many years now, the soft power of today’s media outlets in showcasing our country’s socio-economic prowess as well as their contribution in creating impeccable reputation for today’s businesses and entrepreneurs have been ignored, or at best, utilised minimally or partially. And keeping the same in mind, the Government in this year’s Budget must work towards reversing the existing scenario and offer adequate sops/incentives and other enabling pathways to allow stakeholders to be able to leverage the optimal potential of new-age media and traditional media platforms. Since now is the right time and also high time we bring emerging-technologies to the forefront vis-à-vis India’s efforts to uplift the media sector, I expect that media-tech is being provided a priority sector status in the Union Budget 2023, which in turn will lead to more and more media-tech innovations and start-ups to be able to flourish in India in the longer run.

Lastly, we also hope to see some more stimulus packages and progressive policy moves focusing on growth of India’s entrepreneurial community at large, and women entrepreneurs in particular.”

Shailendra Singh Rao, MD and Founder, Creduce:

“The Budget needs to address the lack of clarity on the Carbon market for sustainable practices in India across multiple sectors. The broad expectation is to provide stimulus to renewable energy efforts as well as light the way forward for the entry of medium and smaller players to contribute to our climate change efforts. It is high time the budget incentivizes the low carbon path as well as contribution to the carbon-free workplaces. This budget would further need to define a better roadmap to include the larger chunk of farmers in the gamut by educating and enabling them to contribute towards climate change with their agricultural practices. Not only will that bring a large chunk into the climate change role but also offer additional sources of revenue for them. Clearing a policy and setting up a Carbon Exchange too should be seen as a priority during the Budget.”

Ashwin Chawwla, Founder & Managing Director, Escrowpay:

“Increase in the GST exemption limit for escrow services: The current GST charged @ 18% for escrow services is very high and needs to be removed completely to provide financial relief to small and medium businesses.

Introduction of tax incentives for businesses relying on escrow services: The government should consider introducing tax incentives for businesses that rely on escrow services. This will encourage more businesses to use escrow services and ensure their transactions are secure.

Banks and Fintechs alliance: The time taken for escrow services is currently 8-10 weeks by a bank. Fintechs like escrow pay, open digital escrows nearly instantaneously. The government should look into ways to reduce the time taken for escrow services and make them faster and more efficient.”

Divya Jain, Co-founder, Seekho:

“Ed-tech has seen course correction over this past year, but has emerged stronger. Especially in higher education and employability, it is the only solution and way forward. We look forward to a lower tax slab for education services to students in particular. Push to implement NEP, which will allow the youth to learning digitally, work and still earn their degrees.”

Vijay Malhotra, Co-Founder & Chief Sales Officer at SahiBandhu:

“The exponential growth of the fintech space in India’s vibrant start-up ecosystem comes with a need for revisions, which will be expected from the upcoming Budget 2023. The Indian services industry has emerged as a significant contributor to the nation’s GDP, and it is imperative that the government should introduce tax parities amongst different sectors. Introducing a corporate tax bracket of approximately 15% could aid the service industry grow and perform beyond expectations. Investments under Section 80C, with the current limit of Rs 150,000 needs revision.

This could allow taxpayers to improve upon their savings, while affecting a significant increase in purchasing power. Further, ESOP holders in Indian startups could gain from tax being levied on the sale of shares rather than on the exercise of ESOP, which is not the liquidity event for employees of unlisted companies. Thus, if these expectations are addressed and adequately tackled through implementation, it could help the country’s economy grow further.”

Ashwin Reddy, Managing Director, Aparna Enterprises:

“Building materials industry bounced back to pre-Covid levels in 2022, registering around 10% growth owing to increased push for infrastructure development and upswing in the real estate sector. The trend is expected to continue in 2023 as well. We believe that the upcoming union budget will continue to see heighted allocation for infrastructural development which in-turn will benefit the building material industry. However, the industry is reeling under the burden of rising cost of raw materials, delayed projects owing to cash crunch, clearance issues and supply chain disruption. Tax slab rationalisation for essential building materials, incentivization of sustainable products and interest subsidy for MSME Players can go a long way in boosting the sector while inflation is arrested with a slew of interventions.”

Suresh Rajagopalan, CEO, Wibmo - A PayU Company:

“In the last few years, we have seen a significant increase in the adoption of digital payments. We expect further digital infrastructure push from the government to make India a cash-free economy. The budget should provide incentives for MSMEs for the adoption of digital payments in Tier 3 towns and beyond. The government should give further push for the adoption of prepaid instruments for reaching out to the financially underserved and the underbanked. We also expect the government to actively promote Digital banks and build a digital banking regime, helping fintech players offer their tech platforms to build optimal credit products and offer best-in-class customer experience.

With the rise in digital payments, payment fraud has also expanded at a rapid pace. The budget should include regulations that would curb the menace of digital frauds, including mandatory adoption of Fraud Management solutions. Furthermore, banks should be incentivized to share anonymized fraud markings data that would help develop robust, cross-banking data models to prevent payment fraud. These initiatives would further drive digital adoption and truly deliver the benefits of a digital economy.”

Ahmad Hushsham, Founder & CEO, YOHO:

“The Indian government is committed to promoting economic growth and development, and this focus has continued since the pandemic. We hope to see a budget that outlines a plan for increasing economic growth along with more investment in infrastructure and incentives for corporate capital expenditure. One important step in this direction would be simplifying the GST structure. Currently, the GST rate on footwear with a sale price above Rs 1,000 is 18% and the rate on footwear with a sale price below Rs 1,000 is 12%, which is confusing. In the past, GST was set at a rate of 5%. However, it has significantly increased over the past few years and is now at 12% and 18%. Reducing the GST rate and having a uniform rate on all footwear would lead to lower prices and potentially increase consumer demand.

Another way to support growth and development would be to encourage the local production of footwear raw materials, components, co-polymers, moulds, and machinery at competitive prices under the “Make in India” initiative. This could boost India’s export ambitions and create employment, leading to lower overall prices and improving consumer sentiment.”

Dr Deepak Birewar, Chairman & MD, Inventys Research Company:  

“Budget 2023 marks the arrival of the last full-year budget from the union government, which is expected to usher in favourable legislative policies to help grow the sixth-largest chemical-producing country in the world. This year, we expect positive momentum towards formulation of the PLI scheme for the chemical sector to encourage domestic manufacturing. With exports of chemical and petroleum products to more than 175 countries standing at a staggering $8.24 billion, we expect the government to implement export benefits for specialty chemicals to aid the overall economy.

Manufacturing business tax exemptions provided by DSIR, under section 35 (2AB) of the IT Act 1961, stands at 100%, compared to the 150% prior to March, 2020. A revision in this tax structure could empower firms to increase R&D expenditure, helping them produce new products and technologies. Additionally, the government can create a Models Specialty Chemical Manufacturing Region in Vidarbha, which could give rise to 3000 MSMEs in the region, with a petrochemical complex acting as a catalyst for industrial growth.

Further, the chemical sector is highly capital intensive with long pay back periods. Capital expansion of the chemical sector could be enabled if the government provides subsidies of 10%-20% for investment projects beyond Rs 100 crore. In the past months, the shift of global supply from China has increased outsourcing opportunities and domestic demand. It has given India more expansion opportunities. By 2025, the Indian chemical industry is expected to reach $300 billion, and focused assistance in export benefits, tax advantages, and capital subsidies will further add thrust to the ongoing growth.”

Vikram Agarwal, Managing Director, Greendot Health Foods:

“This fiscal year, we would like the Budget to enhance food sector competitiveness in the International market. The Government should provide a budget for export incentive schemes to the food sector and a subsidy for overseas participation in major food shows.”