The Budget has attempted to address the key challenges confronting the Indian economy in the wake of the pandemic.
Corporates shared their thoughts on Budget 2022 and its announcements:
Anil G Verma, Executive Director and President, Godrej & Boyce
The Budget for FY 2023 holds a lot of promise for the economy. It has a thrust for the social sector with investments in primary and vocational education, provision for drinking water to reach more households and the extension of the PM Awas Yojana to provide housing. In addition, its outlay for procurement of agricultural produce will reward the farmers for their effort and put money in their hands which will help to propel consumption demand.
The focus on the logistics sector through the PM Gati Shakti plan will give a fillip to the economy. Logistics costs in India count among the highest in the world. Creation of infrastructure is the best way to reduce the costs and introduce competitiveness in the economy to serve both the domestic market and exports. The initiative of spurring investments from the private sector by taking the lead through government investments of Rs. 7.5 lakh Cr. is laudable. The PLI scheme outlay for solar modules will support the solar power generation projects which are currently facing steep cost increases and supply constraints. Support for domestic manufacture of capital equipment by doing away with duty exemptions is also a welcome step.
Anil Chaudhry, MD and CEO, Schneider Electric India
The FY23 Union Budget lays strong impetus on sustainable development. Sustainability has steadfastly become an urgent priority and the proposal to issue sovereign green bonds for building green infrastructure will go a long way in creating a low carbon future and reducing carbon intensity of the economy. This is in line with the government’s commitment on climate action at COP 26. The Budget also emphasizes on energy efficiency and energy transition for reducing emissions. Saving energy is an important aspect of energy management. Hence, energy efficiency and savings measures will be promoted. This will be done in large commercial buildings through the Energy Service Company (ESCO) business model. The proposal of thematic funds for mobilising blended finance with government share capped at 20 percent will also allow fund mobilization for emerging sectors like digital economy and climate action.
Dinesh Kumar Khara, Chairman, State Bank of India (SBI)
The Budget continues to strike a balance between the challenges posed by the recurring COVID-19 waves and the need to contain the economic damage due to pandemic. The Budget achieves this delicate balance quite well. The emphasis going forward is on seven parallel tracks - PM GatiShakti, Inclusive Development, Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition and Climate Action and Financing of Investments. On the banking and finance side the announcements are significant. The Budget proposes to set up 75 Digital Banking Units (DBUs) in 75 districts of the country by Scheduled Commercial Banks. This proposal is in sync with our ongoing digital banking initiatives. The most significant announcement of the Budget are higher allocation to Capital expenditure and extension of ECLGS - particularly the specific support to hospitality & related sectors. The Budget is a very well-crafted statement of intent, drawing from the experience and enhances growth prospects of India in post-COVID world.
Suresh Agarwal, MD & CEO, Kotak Mahindra General Insurance Co. Ltd
It is a growth-oriented budget, focused on high economic activity, covering critical segments of the economy, building on the Atmanirbhar Bharat Agenda. Helps to create a positive environment going forward.
Mukesh Surana, CFO, Garware Technical Fibres Limited
Finance Minister Nirmala Sitharaman's Budget for 2022 depicts the Indian government's well-balanced strategy with a vision in reviving the economy with a larger focus on capital expenditure, infrastructure spending and digital initiatives. The technical textile industry had high hopes from the budget. While not all of the expectations have been addressed, we applaud the finance minister's efforts in managing the fiscal deficit and allocating funds for thriving a truly ‘Atmanirbhar Bharat’. With a higher capital expenditures expected from the budget, it will benefit all the industries.
Shyam Srinivasan, MD and CEO, Federal Bank
The Budget stands out as one that is incredibly multi-faceted and will have a real impact. FM has aimed at policy deliberation but while eschewing grandiose solutions or extensive claims, this indicates the outright truism of the government. 35 percent increase in capex for infra development, 65 percent defense capex for local cos, tax incentives for startups, new cargo terminals – all indicate the refreshingly clear and well-structured aspiration of Atmanirbhar Bharat. Digital economy getting an enhanced call-out for formalization is a welcome move. The demanding need of green infra in the country has also been promisingly addressed in the form of the maiden Sovereign Green Bond. Overall, the optimism is retained, and all of this would give the perfect nudge to our MSMEs. The banking sector would certainly benefit from this, key of course would be improved participation and not a veneering attempt.
Somasundaram PR, Regional CEO, India at World Gold Council
The Budget is very positive for the Indian Jewellery Industry. The emphasis on exports was evident with the announcement of a simplified regulatory framework to allow the e-commerce export of jewellery. The general policy thrust aimed at higher economic growth is again a tangible benefit for gold, as it is well established that income growth is the single dominant factor in long term gold demand. Digital push, MSME support and infrastructure spending address several industry priorities and offer significant leverage for the industry to play a bigger economic role. This year’s budget, read in the context of the significant traction in the implementation of previous year's announcements on gold, point to a stable, sustained path to reforms over the years. Definitely one more reason for industry to cheer after the high five for gold in Q4 by customers”
Prem Kishan Gupta, Chairman & Managing Director Gateway Distriparks Ltd.
The Government plans to boost swifter movement of goods across the country and to support the same one of the main initiatives mentioned in the budget was "Gati Shakti" plan, which envisages, amongst other thing, improvising better rail connectivity. It’s encouraging for the sector to see government’s increasing focus on planning, financing through innovative ways, use of technology, and speedier implementations.