The COVID-19 pandemic ravaged global economies, and India was no exception. With the country still reeling from the ramifications of the pandemic, many hopes were pinned on the Union Budget 2021.
As the budget was presented by Finance Minister Nirmala Sitharaman, various industries have reacted differently to the budget´s proposals. At the highest level, the FM has announced a major central health scheme, income tax rebates, and said the government is focused on farmer welfare.
Read more: Budget 2021: Expectations from IT Healthtech M&E and Homegrown Startups
The budget this year has been riding high on expectations from taxpayers and businesses. To find out if the FM has delivered on the parameters expected, The Tech Panda gathered reactions from experts in various industries, including insurance, deeptech, agtech, and fintech.
INSURANCE
The Government increased FDI from 49% to 74% in insurance.
Yogesh Agarwal Founder Onsurity
“The increase in FDI in the insurance sector from 49% to 74% is an announcement which the insurance sector was waiting for the last two years. This will now bring more investment and infrastructure in the insurance space and will help insurance companies to increase the insurance penetration.
The increase in FDI in the insurance sector from 49% to 74% is an announcement which the insurance sector was waiting for the last two years
“The disinvestment in one of the general insurance companies will bring more expertise in the public sector companies and would enable them to focus on creating more innovative products.
“The increase in the revision of the paid-up capital for small companies is again a welcome move for MSMEs and SMEs, which would lead to further formalization of the sector.”
HOUSING
To keep up the supply of affordable houses, the FM proposed that affordable housing projects can avail a tax holiday for one more year, till 31st March, 2022.
Dr. Nikhil Sikri CEO and Co-founder Zolostays
“There has been the announcement of several measures to simplify business challenges, including changes to the administration of direct taxes, while increasing compliance.
(This) might take us one step closer to not only the PM’s dream of ‘Housing for All’ but also Zolo’s mission for ´Beautiful living for All´
“Affordable Housing Projects have gotten tax rebates extended for a year to March 2022, which might take us one step closer to not only the PM’s dream of ‘Housing for All’ but also Zolo’s mission for ´Beautiful living for All´.”
DEEPTECH
The Budget proposes to launch data analytics, AI, and machine learning driven MCA21 Version 3.0, with additional modules for e-scrutiny, e-Adjudication, e-Consultation and Compliance Management.
Kanika Agarrwal Chief Investment Officer Upside AI
“One area we wish the speech had paid more attention to is the government’s AI/ ML strategy. Given the strategic significance of cutting-edge technology on our place in the world in the coming decade, it would have been good to encourage innovation via a scheme, sandboxes, etc. in the budget speech. The devil remains in the details, but we are happy with the direction in which the government intends to move with this budget.”
Given the strategic significance of cutting-edge technology on our place in the world in the coming decade, it would have been good to encourage innovation via a scheme, sandboxes, etc.
“In the Union Budget 2021, FM Nirmala Sitharaman made several encouraging announcements when it comes to India’s technology sector as well as the startup ecosystem. This, along with the proposed extension of tax holiday for startups by one more year, will enhance ease of doing business and encourage the next generation of tech companies to step up and carry the mantle of development towards a digital-first future in line with the PM’s Digital India mission.”
Rajit Bhattacharya CEO Data Sutram
“We are happy to see the government’s increased focus on technology by leveraging data analytics, AI, ML to revamp MCA-21 portal. This will ensure seamless compliance across businesses of all sizes. With the integration of these advancements, we can expect the MCA-21 3.0 to be equipped with new features like a single source of truth, ease of doing business, e-adjudication, online compliance monitoring, to name a few.
We are happy to see the government’s increased focus on technology by leveraging data analytics, AI, ML to revamp MCA-21 portal
“Incorporation of one-person companies to incentivize innovation is another ground-breaking move for startups and will help them grow without any restrictions, mainly on paid-up capital and turnover. The technology-driven moves taken by the government will also help streamline India’s healthcare and pharma industry, while widening the avenues for recruitment across the startup ecosystem in India.”
Hitesh Jirawla Founder CEO Cubictree
“Indian Courts have been under tremendous pressure with limited availability of judges. Longer litigation results in higher costs and procedural hassles that consumers and companies suffer. The proposed MCA21 Version 3.0 will roll out e-scrutiny and other compliance management initiatives, thereby bringing down the legal costs for companies and individuals.
Use of deep tech will over time impact judgement delivery, thereby making it faster
“Use of deep tech will over time impact judgement delivery, thereby making it faster and for some standard cases, there is a possibility to introduce an element of automation in documentation and other legal processes.
Read more: Budget 2021 Reactions: What Experts Are Saying About the Healthcare Allocation
“We believe the government has taken a lead in addressing the problems that currently ail the judiciary system in our country. Over time, India may see fast closure of matters and justice served to the people who have been waiting a long time.”
FINTECH
The Budget earmarks INR 1,500 crores for a proposed scheme to provide financial incentive to promote digital modes of payment.
Pavan Adipuram Co-founder CEO ChitMonks
“It is heartening that the much talked about COVID cess wasn’t introduced, neither any dramatic increase in taxation for the businesses. For a digital first company like ours, the proposal of INR 1500 crore to incentivize digital payments will accelerate the financial technologies sector growth.
For a digital first company like ours, the proposal of INR 1500 crore to incentivize digital payments will accelerate the financial technologies sector growth
“In investment instruments like chit funds, mutual funds, and online payments, more companies are expected to move to 100% digital payments mode, which will ensure further transparency and confidence in individuals and it will address the problem of any scams running that take advantage of innocent individuals. However, the devil would be in the details. We look forward to the details of this proposed scheme as it will tell us how the incentives will work for the companies and individuals.”
FOOD AND BEVERAGE
Forbes India noted that travel, tourism, and the F&B sector didn’t figure in the FM’s budget.
Prerna Puri CEO and Founder Prerna’s Handcrafted Ice Cream
“Although, on a larger note, the Budget did address a lot of crucial points, there was very little attention paid to the food and hospitality sector, which was the worst hit. We were expecting the government would be announcing major revival packages for the F&B, along with travel and hospitality.
We were expecting the government would be announcing major revival packages for the F&B, along with travel and hospitality
“However, we were left disappointed on that front. Also, there was no mention of promoting women entrepreneurs, which we were hoping the government would focus on. We welcome the measures announced for startups, such as tax holiday for another year and reduction in margin money requirement, there still remains a long way to go to resurrect all aspects of our economy.”
AGTECH
The FM said the Minimum Support Price (MSP) regime has undergone a sea change to assure price that is at least 1.5 times the cost of production across all commodities. However, several farmer outfits have dismissed this assertion, according to The Hindu.
Nikhil Das Founder Agdhi
“The budget presented by Nirmala Sitharaman Ji today acknowledged the importance of agriculture in India’s economy as one of the central pillars employing 15% of the population. The central budget has shown confidence in the MSP regime and has upheld it for the farmer. The budget has promised 1.5 times MSP against the cost of production across all commodities. This is likely to bring in more innovation and adoption of technology in farming. Besides this, the budget has proposed an increase in agriculture credit.”
