Finance Minister Nirmala Sitharaman announced a slew of measures to strengthen the Startup Ecosystem in the country in the Union Budget 2023-24 she presented in the Parliament. Entrepreneurship, she said, is vital for the growth of any economy.
She announced measures to boost agri-tech, fintech, building infrastructure in towns across the country besides announcing tax benefits for startups.
Here is how the world of new enterprises responded:
Startups believe that this budget is friendly towards the middle class and that it will play a crucial role in promoting entrepreneurship in these regions. With blended capital support from NABARD for agriculture and rural enterprises, startups are hopeful for growth and are appreciative of the government's efforts in supporting their endeavors.
Serial Entrepreneur & Group CEO of Horses Productions Pvt Ltd Prashant Agarwal thinks that it is a positive budget for startups. He said, "We are thrilled with the latest announcements from the Finance Minister regarding support for startups.”
He noted, “The extension of tax exemptions and concessions provided by the government will significantly benefit new entrepreneurs and enable them to grow their businesses. This is particularly important for startups in smaller cities and rural regions where the ecosystem is still developing.”
“The government's support for rural startups, through initiatives such as blended capital from NABARD for agriculture and rural enterprises, is commendable and will go a long way in promoting entrepreneurship in these regions. Overall, this budget is a positive step forward for the startup community and we are grateful for the government's support,” he added.
Swapnil Shrivastav, Co-founder of Uravu Labs, has welcomed the focus on the green economy in the Union Budget 2023-24. He believes that the government's initiatives towards the green economy, such as the reduction of indirect taxes and the allocation of funds towards the National Green Hydrogen Mission, will create a favorable environment for startups in the water and climate-tech sector to grow and expand.
Kunal Jhunjhunwala, founder and MD of Airpay, sees three key pillars to the budget that will propel financial inclusion and improve the appetite for financial products in India. He highlights the focus on digitization, ease of doing business for MSMEs, and taxation relief up to Rs. 7 lac of annual income as the key drivers of financial inclusion in the country.
Agritech and Drone Start-ups
Agnishwar Jayaprakash, Founder CEO of Garuda Aerospace, believes that the Union Budget 2023-24 will be beneficial for the development of start-ups in India. He mentions the empowerment of 1 lakh youth through virtual skilling and training universities and the use of AI and ML in drones to monitor soil and crop yield as the key points that will drive the success of agritech startups. The UBI-approved Kisan loan and the government's agri accelerator fund will encourage young entrepreneurs in rural areas to scale their agritech startups.
Auto Parts Sourcing
Himanshu Singh Raghuvanshi, Co-Founder & COO of CapGrid, a auto parts sourcing startup, believes that the budget is driven by market dynamics and has many positives for the green energy sector. He welcomes the decision to extend subsidies on EV batteries and the scheme to replace old polluting vehicles. The credit guarantee scheme for MSMEs, extended with an infusion of Rs 9000 crore, will help the entire auto sector, which is held together by MSMEs.
Pramod Kathuria, Founder & CEO of Easiloan, has welcomed the increase in the outlay for the PMAY scheme to Rs 79,000 crore, which is a significant 66% increase. He believes that the enhanced investment in the housing sector will boost the growth of capital goods and infrastructure companies and provide employment opportunities.
Pramod Kathuria has also welcomed the government's embrace of the digital revolution in the fintech sector and the promotion of the use of Digi locker for documentation. The expansion of Digi locker services to the fintech sector will be a great boost for digital home loan marketplaces like Easiloan.
Payoneer Country Manager Gaurav Shisodia also gives a green thumb to the budget.
Speaking how the budget will help the finance sector, Shisodia said, "The 2023 Union Budget's focus on MSMEs with increased funding and improved access to credit is a positive development for the sector, which is still recovering from the impact of the pandemic. Moreover, I applaud the government for presenting a forward-thinking budget with positive developments for the financial sector and furthering the digitization of the sector.”
Climate and EVs
Shailesh Vickram Singh, Founder of Climate Angels, praised the simplification in indirect taxes, and the decision to extend custom duty benefits for the manufacturing of Li-On cells for EVs. He mentioned that with the right incentives and adequate supply, India has demonstrated a huge demand for EVs, and the growth in demand has solved the question of building giga battery plants. He believes that this decision will result in huge domestic expansion and innovation in the battery space, ultimately making EVs safer, cheaper, and better.
Pritesh Mahajan, Co-founder and CEO of Revamp Moto, welcomed the government's key initiatives in boosting the Green economy and the reduction in custom duty on lithium-ion cells, which will incentivize the product cost for end consumers and boost the sales of EVs. He expects an increased CAGR of the EV sector in the FY 22-23.
Ravi Mittal, Founder & CEO of QuackQuack, is optimistic about the economy's growth at 7% and the focus on startups in the budget. He mentioned that the government's initiative to have more Centres of Excellence for AI development and the Data Governance Policy will unleash innovation and research and encourage startups. However, it is too early to say how and on what the policy will be implemented.
Rishabh Khanna, Founder and CEO of Suraasa, praised the government's commitment to improve access to quality education and to promote the use of technology. He mentioned that the establishment of three centers of excellence for AI, re-envisioning of teacher training programs, and the launch of PMKVY 4.0 will help address the shortage of qualified teachers and provide students and the youth with opportunities to learn the latest technology and compete in the global job market.
Ritika Kumar, Founder & CEO of STEM Metaverse, praised the government's emphasis on last-mile access and digitization of content and training and skill development, which is extremely encouraging for the edtech sector.
Ambika Sharma, Founder & MD, Pulp Strategy feels that one of the important issues addressed was the stressed MSME ecosystem due to or in the duration of the pandemic.
“In case of failure by MSMEs to execute contracts during the Covid-19 period, MSMEs will get 95% of the forfeited amount relating to bid or performance security. This amount will be returned to them by the government and government undertakings. MSMEs are the growth engines of the Economy, and this move will help to boost their morale and will provide them relief. Micro Enterprises with a turnover of up to Rs 2 crore and certain professionals with a turnover of up to Rs 50 L can avail of the benefit of presumptive taxation,” she said.
Manufacturing and Exports
Rajesh Shah, MD & Chairman of Eurobond, expressed his strong support for the budget presented by the finance minister. He praised the budget for its emphasis on comprehensive development of the economy through targeted investments in infrastructure, micro and small businesses, and affordable housing. He mentioned that the budget masterfully balances the imperative need for growth and sustainability and de-carbonization.