Budget 2022 is here and the Government of India is riding on the wave of ‘world’s fastest-growing major economy’ title from China in the current fiscal year. Prime Minister Narendra Modi congratulated Finance Minister Nirmala Sitaraman on the ‘progressive and people-friendly Union Budget for 2022. Given the higher spending through the pandemic government has the fiscal space to spend money on asset creation, and keep the economy on track for another year of world-beating 8%-8.5% expansion, the Economic Survey said on Monday.
This year the GDP is seen to grow by 9.2% and the government’s total expenditure has been increased by 4.8 per cent to ₹ 39.5 lakh crore. In a big boost to the electric vehicles sector, battery swapping will be introduced. Further, a digital rupee will be introduced by the Reserve Bank of India in 2022-23 with no change to Income Tax slabs. Here’s DKODING Union Budget 2022 with industry experts…
Watch: Union Budget 2022 will benefit all, especially the poor: PM Modi
While keeping the focus on growth, the Hon’ble FM has ensured that the budget is also inclusive in nature. It takes care of the specific sectors such as hospitality and education that have been deeply impacted by the pandemic. The special focus on the PM Gati Shakti scheme will have a multiplier effect on the economy. The government’s target of expanding the road network by 25000 km through an investment of INR 20000 crore in 2022-23 will strengthen the infrastructure at the grassroots levels. The announcement of the Parvatmala scheme should fuel the development of eco-friendly tourism in the hilly, remote and ecologically fragile areas. The investment of INR 60000 crore for the tap water connections scheme will be a boon for millions of Indians, especially among the economically weaker section. Additionally, the 400 Vande-Bharat trains will boost land transport. The crucial thing will be rolling out of projects at a quicker pace and ensuring that the public-private partnership programs are designed in a way that supports the companies involved in the infrastructure sector, specifically the MSMEs. Pradeep Misra, CMD, Rudrabhishek Enterprises Limited
The government’s allotment of 48,000 crores to build around 80 lakh affordable homes is a positive initiative for real estate. The expansion of highways by 25,000 km will catalyze the development of new realty clusters and allied industries. The boost to the infrastructure at the grassroots levels will fuel the demand for the sector in Tier 2 & 3 cities. Furthermore, the establishment of the high-level committee for Urban planning will greatly enhance the ease of doing business and result in raising the standards of living in Indian cities. The Union Budget 2022 will sustain the momentum gained in the past few months for real estate and gradually increase it during the FY 2022-23. Harpreet Singh Hora, Group Director, Realistic Realtors
Education and FinTech Sector
The budget balances out both the short-term and long-term requirements of the country. Focus on Funds mobilization, Financial Inclusion, Modernization of Education infrastructure and curriculum, Special impetus for Startups and Entrepreneurship are some of the biggest takeaways from this budget. Startups have been given special recognition which reflects the government’s intent of building a conducive environment for business and entrepreneurship.
Financial inclusion initiates will benefit banks and NBFCs if appropriate infrastructure is provided. Digital Banking and Fintech emphasis, when combined with efforts to make conducting business easier, will further provide momentum to the already-growing Fintech space. The initiation of 75 digital banks across the country will strengthen the foundation of the Fintech sector. The establishment of the digital university will push the Ed-tech sector to the next level and widen the reach of the education sector. The announcements in the budget are a reflection of the growing significance of the fin-tech and allied sectors in the Indian economy. Rohit Gajbhiye, CEO, Financepeer
The Budget 2022 envisions a futuristic approach of the government towards enhancing education and entrepreneurship in the country. The push to digital education through the PM e-Vidya scheme will help in increasing the penetration of digital education to remote areas. Apart from this, the announcement of the digital university will augment the reach of higher education among those who are deprived of higher education due to lack of resources. In addition to enhancing education, the finance minister has laid a special emphasis on startups which shows the intent of the government towards giving impetus to the entrepreneurship ecosystem. Overall, the budget aims at strengthening the fundamental components of the country that will drive holistic growth. Meeta Nagpal, Founder Musical Dreams
“The Union budget 2022 gives confidence to the business community as it focuses on building strategic strengths rather than taking short term and fiscally deviant populist measures. The FM has avoided giving in to the pressure of the upcoming assembly elections. Digital inclusiveness for citizens of all classes increased capital expenditure on infrastructure, push for logistics betterment with the continued development of railways and highways, boost to the EV industry with standardised norms for battery swapping, charging and leasing, and easing the compliance burdens are the measures that are essential for business growth in India. One station – One product is an incredibly powerful idea that seems to be getting lost in the din of seeking short-term tax sops. Equally powerful and progressive thought is the formation of the National digital health ecosystem which recognises mental health as an area of focus for the first time. MSME’s will benefit from the rating programme that’s being rolled out. It will give them better and more fair access to loans and other financial support. Personally is felt most excited by the commitment to invest 25% defence R&D budget with start-ups and academic institutions. This has been a big gap forever in India and is bound to give further impetus to local defence sourcing”. Ravi Saxena, MD and Co-Founder, Wonderchef
Along awaited step to setup international ‘Arbitration Centre’ in is highly welcomed from Ease of Doing Business point of view to reduce timeframe to resolve ‘Commercial Disputes’ on international pace and competence. This budget brings productivity in various sectors of the economy with REFORMS to provide actual Ease like duty concessions for electronics, revoked anti-dumping duty on steel, reduced duty on chemicals etc. It’s equally focused on Structural & Digital Infrastructure both to hold upcoming multi-trillion-dollar economy projections of India Policy on Battery Swapping is being seen as highly needed for standardization of batteries to upgrade ‘Charging’ with ‘Swapping’ facilities to for faster adoption and energy-efficient mobility. Robust expansion of Highways up to 25000 KMS by 2023 with new 100 cargo terminals in the next3 years, Budget also envisioned an ultra-modern logistical framework with encouragement to Startups to promote ‘Drone Shakti’ like ‘Gati Shakti’ for infra to address export. The government clearly intends to harvest recent growth in export during pandemic years by strengthening the logistic sector with clear directions to Rail, POST to work together on logistics and also bringing Post Offices on core banking systems by 2022 is a masterstroke showing both intent and competence of union government to extend digital infra to include rural and semi-urban in export economy. Mr Abhijeet Sinha, National Program Director of Ease of Doing Business
I believe announcements around the National Digital Health Ecosystem in the Union Budget 2022 are a positive step towards digitization of health records and making data exchange & analysis easier both for providers as well as patients. If implemented well can certainly lead to efficiencies in diagnosis & treatment. The digital health ecosystem can further improve access to quality yet affordable healthcare for citizens. Further, National Tele Mental Healthcare Program is a rare mention in the budget and thus, recognizes the importance of mental health in India. Mental wellbeing has been a taboo subject in our country, this digital platform can greatly help mainstream mental health alongside physical wellness and will make medical help available to patients at the right time.
While the aforementioned are positive developments, however, incentives & reforms encouraging investment in technology upgrades in healthcare and an increase in overall healthcare public expenditure by the Government can immensely reduce the Out of Pocket healthcare expenses burden on citizens, which is currently one of the highest in the world. I hope the Government recognizes this and evaluates it for future consideration. Anurag Khosla, CEO, vHealth by Aetna India
This digital budget is truly a strategic one that not only envisions strengthening the fundamentals of the country but also steers the economic growth mechanism through a lens of sustainability. The futuristic approach of the government can be attributed to the factors like the emphasis on increasing Capital expenditure, Digital inclusiveness, Modernization of Infrastructure, Easing Compliance and Financial empowerment. This further fuels the confidence among the business fraternity to build an ecosystem that is Robust, Global and Progressive. Thrust on expanding and restructuring the Education through digital penetration manifests the government intent of reaching the under-reached which is eventually going to strengthen the foundation of the country. Unparalleled acknowledgement of Startups and entrepreneurship augurs the unprecedented tailwinds that will facilitate the economy finding the green shoots. Vishal Gupta, Co-Founder, Brands2Life
“The FM has delivered a Union Budget today that was clearly focussed on economic recovery through increased capital expenditure for the country’s growth. The push towards self-reliance reveals the government’s steadfast intention to achieve the long-term goal of ‘Atmanirbhar Bharat’. The extension of the ECLGS scheme till March 2023, as well as the expansion of the guarantee cover by ₹50,000 crore to ₹5 lakh crore is a welcome sign for the NBFC sector and over 130 lakh MSMEs. The thrust to digitise India and the focus on the fintech segment will help enhance financial inclusion. The affordable housing segment also received a boost today, with the allocation of Rs 48,000 crore under the PMAY urban and rural schemes.” – Ajay Pareek, Chief Business Officer, Fullerton India Credit Company
“The Finance Minister has unveiled a Budget that aims to bridge the economic gap between India and Bharat. The proposed policies are an inspiring start in what will hopefully provide stimuli for continued growth, leading us closer towards our goal of achieving sustained acceleration!
I welcome the focus on digital aspects of education and creating greater access for students with structured, high-quality content. The announcement of Digital University is most welcome and in line with the trend of online schools across the country. But, it misses the opportunity to leapfrog with more significant innovation and investment for improved access, equity and affordability. The structural flaws of the education sector and problems on the ground could have been addressed. Exciting times are ahead for Digital Education.” Yeshwanth Raj Parasmal, Co-founder, 21K School – India’s only digital school
‘The blockchain-based digital rupee is a welcome step. While the critics rightly point out that it’s not decentralized & issued by the govt, we need to understand that the mainstream adoption of web3 & crypto won’t happen overnight. It will happen slowly with small steps toward our eventual goals. And such a blockchain-based digital rupee has the potential for being a big step in onboarding 100s of millions of Indians into the blockchain economy. It will also help open one of the largest economies to new innovations in the web3 ecosystem.’ Aniket Jindal, Co-founder, Biconomy
According to Tarusha Mittal, COO and Co-founder, UniFarm, a group staking protocol, ‘Digital currency seems to have finally caught the government’s attention.
This signifies a good step and it is a welcome step towards the sentiments regarding
cryptocurrencies as there are considerably fewer chances of a ‘ban’ or ‘prohibition’ of it, which is untenable anyway.”
Further adding, “According to our Finance Minister, Income from the transfer of digital assets is to be charged 30% tax, plus 1% tax on the transaction. So, we now at least know what the retail users can expect this year. At the same time, the tax bracket is a bit concerning as it is on the higher end and individuals might have wanted lower LTCG taxes and carry forward of losses similar to equity or housing. I believe the overall outcome will revolve around how the tax regime will be implemented. We would like to see the finer print to really understand the implications for asset classes – corporates and retail users. But this is at least a start. The introduction of digital rupee using blockchain technology will further help in reducing financial and physical efforts required for money management and increase the awareness around the technology.’
According to Aishwarya Shivakumar, CEO, Oddz Finance, a one-stop decentralized
finance crypto derivatives trading platform. ‘The inclusion of the crypto and blockchain sector in the Union Budget 2022 is a welcome step taken by the Government of India. With the announcement of RBI launching its own digital currency using blockchain in 2023, the awareness of the technology and the economics surrounding it is only bound to increase. This announcement also implies a positive outlook of the government towards this technology and its potential. Furthermore, clarity regarding taxation of virtual assets helps clear out ambiguities regarding the Government sentiments around cryptocurrencies as the ambit of the Finance Ministry has expanded towards the cryptocurrency and digital assets sector. Income from the transfer of digital assets entails taxation of 30% along with a 1% tax on the transaction. This seems to be on the higher spectrum but it is a start and we hope to go only forward from this. We are further looking forward to seeing how it fares in more detail in the coming months.‘