As the country awaits major economic relief. At a time when the markets are stuttering in one of the worst slowdowns.
Here’s what India Inc. expects from the Union Budget 2020.
Murali Urs, Country Manager-India, Barracuda Networks
As we are witnessing the rapid adoption of technology in every sector, the government has surely put India on a digital innovation fast track to achieve the $5 trillion economy. This advent has also led to cybersecurity and data protection becoming key concerns in businesses and government agencies.
Attacks keep getting more advanced, and there is less talent available to manage it. As more and more businesses leverage public cloud infrastructure and solutions, human error will continue to be the primary source of breaches, leading to misconfigurations and overlooked vulnerabilities., email remains a top threat vector and continues to be the easiest and most effective way for cyber-attackers to harvest user credentials and personal information, or install malware on a target’s machine.
The government has taken a lot of initiatives to strengthen cyberspace in India, However, the government needs to emphasize more on the infrastructure and a lot of systems need better hardware, proper software audits, and execution of proposed projects.
More importance can be given to ensuring that e-mail is more resilient to threats, and offering more effective ways to detect spear-phishing and other fraudulent activities.
There should be a clear cybersecurity framework for encouraging businesses to partner more closely with government agencies, to share threat information in ways that will help keep consumers and companies more aware and protected.
Organizations will be looking at both security companies and the government for help in navigating complexity in a way that helps them stay secure.
With the increasing amount of breaches emerging across the country along with government websites getting hacked, the necessity of creating a secure framework for all institutions is very critical and we hope to see more funds being allocated to ensure cybersecurity.
In the Union Budget 2020, we also hope to see more initiatives and policies towards training and skill development of the youth especially in Cyber Security, Artificial Intelligence, IoT, 5G, Machine Learning, Blockchain, among others.
Swathi Bavanaka, Co-founder & COO, Evibe.in
For the year 2020, we are optimistic that the Union Budget will renew focus on startups and the fiscal impetus they need.
The last budget missed the mark when it comes to major inclusions for the technology startup sector, we are optimistically looking forward to a course correction this year.
As India is becoming a hub for homegrown start-ups, it would be great if the Government can take this up as a priority area in the budget, allocate more funds and announce policies that would encourage the startup sector.
This will help create a more welcoming ecosystem for the industry players and catalyze innovation.
Dr. Vidya V Bhat, Medical Director, Radhakrishna Multispeciality Hospital & IVF Centre
As we look forward to some key announcements in 2020 Union Budget, there is also high expectation from the healthcare sector. As a Gynecac endoscopic surgeon and IVF specialist, I expect a favourable budget for patients suffering from infertility.
Welcoming a baby is a life-changing decision but infertility diagnosis is not completely covered as insurance companies might cover one kind of treatment, but they might not cover another.
I hope that the government takes some important steps towards covering these treatments. Another important point that we hope the Government focuses on is to reduce GST exemptions on medical equipment so that we can invest in newer medical equipment and in turn give quality healthcare at low cost to the vast majority of the population across the country.
GST has increased the cost of various medical equipment due to which we end up paying more tax and in the end, we are unable to procure the best of equipment that is currently available. So, to make healthcare more affordable, high taxes levied on medical equipment need to be reduced.
Aditya Agarwal, Co-Founder, Wealthy
All eyes are on the Union Budget 2020. Given the current status of the economy, reviving investments and consumer demand is key to restore the confidence of both the common man and market entities.
This would help investments to flow in and provide a much-needed boost to the economy. It would be in the country’s best interest to focus on investment options for big budgets.
We are hoping for the government to accord Cat 3 AIFs with a tax pass-through status and simplify NRI participation in our financial market via Equity Mutual Funds, Debentures and other market-linked instruments.
The under penetration of the insurance industry is also an opportunity that can be leveraged. Creating a central repository of insurance policy data through PAN would be beneficial in taking insurance to the nooks and crannies of India where it is required the most. A reduction of GST on Health Insurance would also prove to be a positive enabler in this regard.
Basavaraj Puttappa, Founder and CEO, Zeva Astras
In the wake of recent developments, it is apparent that the economy is showing signs of a slowdown. The government is on the ‘disaster management’ mode to get the economy back on track.
Given the situation, the Budget is expected to focus on immediate measures to propel the economy towards growth. The government has already reduced corporate taxes and might also consider cutting down personal taxes.
Such a move will increase consumption levels and stabilize the economic slowdown. However, this would increase the fiscal deficit and might put inflationary pressures on the economy.
Thus, along with the tax relaxations, the government can push-up the tax exemption levels on long-term capital gains. Formulating such a strategy would increase investment and boost the capital market.
Bharat Khatri, Country Head, Xaxis India
The common expectation from this Budget is one that triggers growth. I sincerely believe that this Budget will trigger credit growth that results in industrial activity, which in turn is expected to trigger consumption growth.
As advertising is a very emotion –lead business in the country. And anything that drives GDP growth, drives advertising growth even more. So, the new budget needs to be growth-oriented, needs to put more money in the pockets of the rural and urban consumers, to boost spending.
While the Finance Minister did reduce corporate tax, there is a pressing need to rationalize GST in advertising as 18% is very high. The process and procedures need to be simplified as they are cumbersome, unproductive and waste a lot of time.
I am also optimistic that we will see a renewed focus on growing digital infrastructure and smart cities more Wi-Fi connection points, making it possible to bring new users and customers to Indian companies.
Arun Nathani, CEO & MD, Cybage Software
The Government of India has taken steps in the right direction to address the economic downturn by slashing the corporate tax rates benefitting the software industry and companies like Cybage.
As part of Budget 2020, a combined step taken towards corporate tax and a rollback of DDT across board will bring in FDI and incentivize the industries to ramp up the capex/ opex spend once the demand is back. Rationalizing the GST rates and compliance processes will outgrow the consumption rates.
The Indian IT industry will welcome specific incentives like weighted deductions for investing in R&D of AI/BI technology tools to facilitate IT companies, Universities, and Research Institutes.
Aditya Vazirani, CEO, Robinsons Global Logistics Solutions
Currently, logistics costs amount to 13-14% of the GDP, which is over 2.5 trillion – much higher than the cost in other countries. This is detrimental to the competitiveness of domestic products in the international markets, thereby impacting exports.
With an aim to address this, the government has drafted the National Logistics Policy (NLP), which is designed to promote faster and seamless movement of goods across the country, while reducing the transaction costs.
In line with this, the National Infrastructure Project (NIP), which is set to develop over 102 Lakh Crore worth of Infra projects in the next 5 years, is also designed to aid in faster and cost-effective logistics solutions. While these are progressive policies, effective and timely implementation of these will be vital to generate the expected results.
Apart from the above, budgetary policies that can strengthen India’s domestic markets, especially the manufacturing and the transportation sectors, can help boost exports and international trade, thereby strengthening the logistics sector and bring in foreign exchange.
Akash Sinha, Co-Founder and CEO, Cashfree
FinTech has boomed in 2019, with India witnessing the highest adoption rate globally. As one of the fastest-growing FinTech markets in the world, we have a lot of expectations from this year’s Union Budget, owing to several measures issued by the government to create a sound and profitable environment for start-ups while enabling Digital India.
The government has paved the way for video KYC and digital KYC with the amendment of the Prevention of Money Laundering Act (PMLA, 2002) and the issuance of RBI norms, clearing the path for a paperless and remote form of KYC compliance. Given the advantages of digital KYC for conducting hassle-free digital on-boarding, these benefits need to be extended to businesses as well, since the current norms apply only to individuals.
With the announcement of zero MDR on UPI and Rupay cards, the government’s vision is to foster digital transactions in the country. We are hoping that the government will relax its stance on zero MDR gave that banks and other service providers could be discouraged from providing merchants in rural areas with payment infrastructure and digital payment options since the complete withdrawal of these charges would make it difficult for them to absorb the costs.
We are optimistic that the government will take innovative routes to build a cashless economy, such as establishing data centres to facilitate smooth and hassle-free digital transactions even in remote, rural locations. The need for a common legal framework to deal with consumer issues for the entire financial sector has become inevitable.
While there have been several moves made to simplify taxes, compliance, and regulations, we are looking forward to a policy framework that enhances the ease of conducting business for startups in India. To address the current economic climate, we anticipate a further slash on the corporate tax slab, of 22%, for startups, to encourage new and existing ventures, as well as the continuation of the benefits of the waiver on Angel Tax for DPIIT registered startups. With the e-commerce sector spurring growth in the digital payments space and Fintech companies fuelling India’s ‘USD 5 Trillion Economy’, we hope that favourable tax benefits would be granted to startups in the fintech space.