Finance Minister Nirmala Sitharaman on February 1 presented the last full budget of the Modi government with general elections due in 2024. From raising capex, rejigging tax slabs, giving a boost to the rural sector to education, the Budget tried to pack something for everyone.
Here is what stakeholders and top business leaders have to say about the Budget 2023:
Anil Agarwal, Chairman, Vedanta Ltd
This Budget is one of the best budgets ever, truly inclusive and addresses the aspirations of every section of society. It empowers India’s 1.4 billion people as drivers of the India story. I compliment the PM and FM for the long-term vision that was laid out in the Budget speech as well as the many progressive announcements, like increased outlay for capital expenditure, incentives for the start-ups and MSMEs, green energy, a lower tax for the middle class and boost to tourism which will create massive jobs and reinforce India’s position as the fastest growing major economy in the world.
Bhargav Dasgupta, MD & CEO, ICICI Lombard
The Union Budget FY23-24 is an extremely progressive and inclusive one with a huge focus on infrastructure and capex growth while maintaining the fiscal consolidation path. With fiscal deficit being reduced to 5.9% whilst providing an extremely bullish capex investment of Rs. 10 lac crores (highest ever); will in effect convert revenue expenditure to capital expenditure which has a higher multiplier effect. It will also mean net borrowing by the government being lower than anticipated at Rs 11.8 lac crores and that augurs well for the bond market and the corporate sector as a whole. Moreover, with tax relief at an individual level would mean an additional Rs 35,000 crores available for consumption. Fuelled by ease of doing business related policies and regulations, this will bolster growth especially in the highly regulated financial services space. For a category like general insurance, these macro economic indicators would provide the much-needed thrust for bridging the penetration gap in the country.
There are some pertinent developments that will enable growth for the industry in the longer horizon. The focus on tourism will pave the way for not just generating employment and investments but also travel insurance in the long term. We have always been zealot about capacity and capability building in health arena and Govt setting up nursing colleges is a positive development. Infact I believe the CoE on AI being set up could be a game changer with access to right talent pool in India. On the auto front, the old vehicle and ambulance scrapping policy is a step in the right direction. Overall, the budget this year has been growth oriented while also being fiscally responsible which is laudable.
Rakesh Bharti Mittal, Vice Chairman of Bharti Enterprises
Telecom is the highest taxed sector today. The only thing we were asking the government to look into were taxes for our sector. That is something we wish for and will look ahead for in the next year budget. However, it has been an inclusive budget and we are happy with it."
Sanjeev Puri, MD, ITC
It is a very good, growth-oriented budget. It shows consistency of thought & strategy. Good for business environment. It is inclusive & prudent & touches all sectors of society for development. Public works when combined with growth we are seeing of private capex, though it is nascent right now, it will have a progressive future & good multiplier effect on the economy & make our economy more competitive.
Bimlendra Jha, Managing Director, Jindal Steel & Power
As expected, the government continues to put focus on infrastructure and construction with a budgetary allocation of Rs 10 lakh crores for the sector. This augurs well for Steel and Cement. These industries will also gain from the focus on rail and transport infrastructure projects as well as budgetary allocation to improve urban infrastructure in tier 2 & tier 3 cities.
Sumant Sinha, Chairman and CEO, ReNew Power
The focus of the budget on expanded support for infrastructure investment, growth of small industry and agriculture sectors, while committing to fiscal consolidation, strikes the right balance. In the context of overall geopolitical and economic outlook, the outlay of Rs 35,000 crore for energy transition and energy security is a significant step forward. We believe the Finance Minister has presented a Green Budget that demonstrates the Government of India’s unwavering commitment to achieving Net Zero by 2070.
For the clean energy sector, there are several welcome announcements. Support for Battery Energy Storage Systems (requested by ReNew Power during pre-budget consultations), the transmission infrastructure to evacuate power from Ladakh, the allocation for biogas to energy projects and the initiatives for scrapping of old vehicles of the central and state governments are all significant steps in the right direction. We look forward to seeing further details on the recently announced Rs 19,500 crores allocation for the National Green Hydrogen Mission.
The budget will give a thrust to accelerating clean energy in India and ReNew Power is committed to support the Government of India in this endeavour.
Kamal Bali, MD & President of Volvo Group in India
The budget is commendable for being extremely well thought out - it is growth-oriented, bold, inclusive and responsible, upping the ante on infra creation, connectivity and logistics efficiency as well as on green & digital future. Clearly, the budget has brought in the entire value chain especially the youth, MSMEs and the Agri sector, while being fiscally prudent. I am sure the private sector will respond very pragmatically to this outstanding budget.
Ritesh Agarwal, Oyo founder and CEO
We welcome the move to develop 50 cities across India as a complete package for domestic and international tourism and developing an app to ensure all the key metrics related to travel and tourism for the said cities are regularly updated.
We also laud the move to incentivise states to set up ‘Unity Malls’ in their most popular tourism destination for the promotion of GI, ‘Made in India’ products and handicrafts. Integrated development of theme-based tourism circuit under the Swadesh Darshan Scheme, with special focus on improving infrastructure and amenities in border villages will provide a much-needed boost to rural and agriculture tourism. This will empower the farmers in building and setting up homestays that provide an additional source of income for them while also providing an authentic Indian experience to the travellers.
Dilip Oommen, President of Indian Steel ssociation, & CEO of AM/NS India and Executive Vice President of ArcelorMittal
A progressive ‘Saptarshi’ Budget – the first in Amrit Kaal – has hit the right notes to fuel growth across industries and propel India to become a global manufacturing hub.
A significant 33% increase in capital expenditure to Rs 10 lakh crore – 3.3 % of the GDP, thrust to fast-track infrastructure development, and the highest ever Rs 2.40 lakh crore for railways will translate into robust domestic steel demand, thus spurring private investments and job creations.
First and last-mile connectivity for sectors like steel, ports, coal, etc. with an investment of Rs 75,000 crore will improve logistics efficiency. This Budget is focused on growth and improving consumption. At the same time, there is a focus on the green economy and digitalisation. Reforms are on the right trajectory of fiscal consolidation to reach the targeted fiscal deficit level below 4.5% by 2025-26.
The Budget underpins a long-term plan that shows the right path to drive economic revival at a time when advanced economies are facing a tough time.
Rajesh Gopinathan, MD & CEO, Tata Consultancy Services (TCS)
The Union Budget 2023 by the Honourable Finance Minister further builds on the government’s focus on enhancing India's digital infrastructure and enabling growth pathways for the Indian economy. The provisions for research in artificial intelligence and 5G implementation, and the Government's vision of Make AI in India and Make AI work for India are commendable. Bringing in the National Data Governance policy is also a welcome step. Overall, it's a forward-looking budget that will fortify the digital spine of the country.
Prashant Kumar, MD & CEO, YES BANK
The Union Budget 2023 attempts an inclusive growth structure for the economy through various measures that are expected to reach the last mile. The effective capex of the Central government was enhanced to INR 13.7 Lakh crores, or 4.5% of the GDP was an acknowledgment that capital expenditures are crucial for the economy and could boost the growth.
As the efficiency of capital expenditures is higher at the state level, the government once again earmarked INR 1.3 lakh crores as a 50-year loan to States, which would incentivize capital expenditure. ECLGS scheme continues with an additional INR 9000 crore added to the corpus which would boost the fund flow for the MSME sector.
Angshu Mallick, MD & CEO, Adani Wilmar Ltd.
We congratulate the central government for guiding the country to become the 5th largest economy in the world. The Union Budget 2023 reflects upon the government's plan to stimulate India's economy with a well-planned policy and regulation-based framework. We believe, the various schemes and policies will play a critical role in laying the foundation for accelerated digitalization and enabling Indian businesses to become prominent players on the global stage.
As one of the leading players in the FMCG sector, we are optimistic about a strong uptick in rural demand on the back of ,massive wave of digitisation through an array of infrastructure-led initiatives announced by the Government, thereby empowering the farmers and the agricultural sector. Furthermore, decentralisation in storage facilities will provide further assistance to ensure India’s surplus food produce is not wasted. The total CAPEX outlay in the Union Budget has been enhanced by 33% from 7.5 Lakh Cr to 10.0 Lakh Cr which takes it to an all-time high of 3% of GDP, this positive outlook will surely stimulate consumption, generate opportunities both in rural and urban employment and jack up local production.
Overall, the Union Budget 2023 lays a strong foundation for India@100 with enhanced focus on farming sector, which is the backbone of Indian economy as well as digitisation that will open new growth opportunities for the economy.
Rajesh Magow, Co-Founder and Group CEO of MakeMyTrip
It is noteworthy that the Honorable FM has highlighted tourism as a focus area. The union budget entails multiple welcome initiatives like the revival of 50 airports, the building of 50 new destinations, and high budgetary outlays on railways, roads, and highways, which will help long-term growth for the domestic travel and tourism industry.
However, one budget proposal that will negatively impact the industry is the move to increase the TCS mandate from 5% to 20% on overseas tour packages. This will not only increase the upfront cash outflow for customers but will also give an unfair advantage to foreign-based online travel booking platforms over India-based travel agents and tour operators.
Abhay Bhutada, MD, Poonawalla Fincorp
The 2023-2024 Union Budget presented by FM Nirmala Sitharaman showcases the government's commitment to putting people first and uplifting the nation's financial status. With a focus on 'janbhagidari' through 'sabka saath, sabka prayaas' and seven pillars, including green growth, youthpower, and infrastructure investment, this budget sets the foundation for a technology-driven and knowledge-based economy. The new tax slabs, with a reduced maximum marginal rate of 39% and an income rebate limit of Rs 7 lakh, empowers the middle class with more spending power, thereby elevating the country's economy.
The government's continued support and commitment to the MSME sector are commendable, as it is crucial in driving the nation's economic growth. The improved credit guarantee scheme, along with reducing compliances will significantly help alleviate stress in the MSME sector.
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