The Union budget 2022-2023 is to usher in growth and a steady economic revival. The GDP is pegged at 9.2%, the budget is also giving a huge push to 5G which in turn will boost digital technology. Though there has been no change in personal taxation, the industry sentiments are strong. Advertising & Marketing along with the Digital sector feels that the budget will boost digital adoption and transformation across geographies.
Anurag Bansal, Chief Operating Officer & Chief Financial Officer, DDB Mudra Group: “This Union Budget looks neutral, with no major changes in taxation. The launch of the digital Rupee based on blockchain technology is a big move to bring in official cryptocurrency in India. New e-passports with embedded chips would definitely ease overseas travel. Managing the Fiscal deficit while pushing for growth and investments is a great balancing act taken on by the government. It will give a boost to capital investments and infrastructure development.”
Anupriya Acharya – South Asia CEO, Publicis Groupe: The Budget is positive, growth-oriented, and with reforms in the right direction.
The advent of 5G is sure to transform communications – for our industry, it will help the creation of better AV, voice, and AR/VR experiences. It will also fuel digital payments, streaming entertainment, gaming, e-commerce, telemedicine, etc which in turn will aid more Unicorns! It is also heartening to note that a special Task Force is being set up for AVGC (Animation, Visual Effects, Gaming, and Comic) as this will help us build the much-needed capacity both for domestic as well as global markets. And then there have been no changes in income-tax slabs for people, which many consumer segments were worried about. This in turn boosts consumer sentiment. From e-passports to battery swapping for electric vehicles, setting up of optic fiber in the remotest of villages, setting up of a digital university, and skilling through an e-portal, the big push is for technology, digital infrastructure, and empowerment.”
Narayan Devanathan, Chief Client Officer, dentsu India: Having gone through the 38-page document of the Finance Minister’s budget speech, I decided to do a search for a couple of words that I thought kept repeating throughout her speech. The words “will be” occurred 110 times in the entire speech. When I narrowed my search to the single word “will,” the number rose to 362. To me, those two words sum up the essence of what this year’s budget is and is not. What it is a future-focused budget, aiming at the distant vision of India@100, with a 25-year Amrit Kaal lead-up. What it is not, and what I felt was sorely needed this year of all years, is a present-focused budget.
A punishing 2021 for the aamaadmi with more-than-usual expenditure on health and sustenance meant the general populace was looking for immediate relief that would place more cash in their household budgets. That did not happen. Nor was there any extraordinary investment in relieving the healthcare expenditure burden. For all the importance of farmers in upcoming poll-bound states, there was neither major sop nor stimulus given to back the importance of agriculture as a spine if not engine of the economy. Even the MSME sectors were only handed a slightly longer lease of life with the extension of the ECLGS, but there was no real move to stimulate consumption by placing more cash at consumers’ disposal, for example, extending LTA claims to restaurants (and not just accommodation).
There is perhaps plenty for the industry to cheer about since it can afford to think about the future and a slightly longer term than just the here and now of survival. The stock market did cheer up even before the FM’s speech, but that only served to underscore the dichotomy between the real health of the population and the Minority of Haves. When the general population probably can’t afford to wait for the benefits of trickle-down economics to reach them in yet another trying year, the dreams and wheels of a consumer-driven economy might move slower than the industry might like, despite the many future-facing and progressive policies announced.
Kartik Sharma – Group Chief Executive Officer – India, Omnicom Media Group: “With an impetus on holistic growth, developing infrastructure and job creation across sectors, the 2022 union budget shows promise with a focus on the big picture.
Reviving economic growth in the post-pandemic environment has been a focus for this government and this progressive, digital-first, and development-oriented budget reflects that. Not only does it provide a boost to the MSME, agriculture and healthcare verticals, but also signals that investing in infrastructure today will connect India better tomorrow.
With an increased focus on digitization, some of the standouts for me were that the budget recognized the current gaps and opportunities within the education sector, and is advancing towards uplifting India with the creation of a digital ecosystem – one that is focused on upskilling and creating more employment; aligned with the dynamic needs of today. It also aims to further strengthen communications in the rural sector and build upon the overall financialization of India. Furthermore, while the rollout of a 5G ecosystem will improve the quality of services, the launch of digital money, supported by blockchain, signals an increasing focus on transparency.
With consistency in strategic direction and focus on propelling the MSME and start-up ecosystem, this is a welcoming budget for new-age businesses and a hopeful one that will ultimately lead to a boost in the A&M industry as well. We’re at the cusp of the next stage of India’s digital revolution and although certain factors like data privacy remain an area to be delved deeper into, as infrastructure and banking penetrate further into rural India, we’re looking hopeful and strong to transform into a forward-leaning digital economy of tomorrow.”
Ambika Sharma, Founder and MD, Pulp Strategy: The Budget is interesting as the Government has focused on all sectors. The financial support for the digital payments ecosystem is a welcome move and further reaffirms the Government of India’s digital banking push. This push on digitization will make way for more inclusion in the ecosystem. The focus on ‘Ease of doing business is a great step, as it will further promote entrepreneurship in the economy”. The 2022-23 budget finely balanced fiscal retreat with supporting economic recovery. The budget focused on a familiar strategy of driving capital expenditure to drive growth, to crowd in private investment through higher public spending. Although markets could be disappointed with a higher fiscal deficit of 6.4% of GDP for FY23 than expected, it is perhaps prudent to not undertake aggressive fiscal consolidation at this nascent stage of recovery. While elevated market borrowings are likely to pressurize bond yields, the inclusion of green bonds in the borrowing plan is an interesting innovation. In terms of specific policy announcements, the move towards self-reliance through protection for domestic manufacturers (change in custom and import duties) aligns with the long-term goal of Atmanirbhar Bharat. The government has extended the startup tax holiday and concessional tax for manufacturing startups by a year. While that was on the cards, it doesn’t address the core need of startups to be given a longer tax holiday of 5 years as required. One of the most encouraging aspects of the budget has been the announcement to set up an AVGC (animation, visual effects, gaming, and comics) promotion task force to plan and build domestic capacity for serving domestic as well as global markets. Loss from the transfer of virtual digital assets cannot be set off against any other income. The creation of a unified logistics platform and the developments of 100 new cargo terminals in the next three years are significant steps in improving the supply chain ecosystem in the country. Infrastructure status given to Data Centers will provide a huge boost to the fast-evolving digital environment of the country. The fiscal outcome is broadly in line with our expectations with the government having continued its focus on infrastructure and rural demand.
Ahmed Aftab Naqvi, Global CEO & Co-founder, GOZOOP Group: “While there will always be hope for more and better, the continued push towards digital, fintech and the boost for start-up ecosystem with the extension of tax benefits till March 2023 along with capping the surcharge at 15% irrespective of the amount of long term capital gains, will fuel the fire of entrepreneurship in our nation.”
Chetan Asher, Founder and CEO, Tonic Worldwide: The budget clearly will help the country march towards digital adoption and transformation in many sectors. With 5G rollout on the cards, we will see acceleration across the board. The digital rupee will put India right up on the map of advanced digital economies. Clarity on Digital assets and crypto will give it new impetus. All of these initiatives will help us emerge as leaders in the adoption and growth of blockchain technology.
Sidharth Singh – Co-founder – CupShup: With elections on the card, it was expected that there wouldn’t be any big announcement to rock the boat. Plus, with Fin Min coming up with policy announcements across the year, key reforms and decisions are now reserved for the more opportune moments.
However, the finance minister had some key announcements to make with wide implications. While the launch of the digital rupee might give jitters to people who have invested in cryptocurrency, it is a further advancement in the direction of regulating an industry that has refused to self-regulate and posing as an investment opportunity with unbelievable RoIs. We will see more sanity in the communication coming from this industry. While in the short term, it might hurt, the move will be beneficial for the industry in the long term.
Secondly, the extension of ECLGS till March 2023 is like a lifeline for Hospitality, a sector that has borne the brunt of the pandemic thrice in the last couple of years. Although much is needed to be done in this space to help smaller players bounce back, the announcement for the National Ropeways Development Programme to be taken up in PPP mode to improve connectivity will see the influx of tourists to neighboring locations and help the hospitality sector. We hope that with this and other help from the government in times to come, the hospitality sector reclaims its glory sooner than later.
Kunal Lakhara, CFO, Pocket Aces: “This budget has paved the path towards reviving the economy with the decision to keep the fiscal deficit pegged at 6.4% of GDP in 2022-23. The tax benefit offered for start-ups, by extending tax redemption for another year is much appreciated and will further encourage the start-up ecosystem of the country to grow and sustain their businesses while recovering from the pandemic. The start-up sector growth coupled with the promotion of AVGC is bound to create a multiplier effect for the economy through the creation of jobs and an overall increase in GDP. Launching our digital currency using blockchain and other technologies is a welcomed move. Providing support under the PLI scheme for 5G is another step in the right direction and will help enhance the content consumption experience. Overall, the Union Budget 2022- 23 is a step towards a successful future and a significant milestone in the growth story of the country.”
Prasad Shejale, Founder and CEO, Logicserve Digital: The FM has announced a very progressive budget to widen India’s horizons and outlook in the next five years, leveraging emerging technologies. The Government has addressed some urgent priorities underpinning the digital sector, including the launch of digital currency, API-based skill credentials, digital learning channels, digitization of manual processes, etc.
On the digital connectivity front, the 5G spectrum auctions will finally make the dream of a tech-savvy India a reality, further boosting the country’s digital infrastructure. Additionally, the launch of a design-led manufacturing scheme for the 5G ecosystem as part of the PLI scheme will ensure affordable broadband and mobile communication even in far-flung areas. The availability of high-speed internet connectivity in urban as well as rural areas will encourage marketers to experiment with blockchain, AR, VR.
On the skilling front, initiatives like establishing a digital university will provide an opportunity for youth to learn new skills from the comfort of their homes. The creation of a new task force to build domestic capacity in the Animation, Visual Effects, Gaming and Comic (AVGC) sector is commendable.The overall budget is future tech-enabled and balanced.
Neeraj Roy, Founder & CEO, Hungama Digital Media: “This is a budget that is welcoming web 3.0, the Indian government has been at the forefront of digital adoption, via earlier initiatives such as Digital India, StartUp India etc and now with the introduction and recognition of ‘virtual goods or digital assets’, the initiative of a task force for Animation, Visual Effects, Gaming etc (AVGC) and even the introduction of a digital bank that would embrace the Blockchain, it is there a way of ushering in a New India into the Metaverse. We welcome these announcements and look forward to setting a place of leadership for India in web 3.0”
Siddharth Devnani – Co-Founder & Director – SoCheers: Digital and digitization stood out as a strong overall trend in the Union Budget 2022. The budget put a great focus on long-term growth and given how intricately ‘digital’ was integrated into several measures, it can be seen as an integral part of that growth.
Implementation of the Central Bank digital currency will definitely aid the growth of the digital economy and finance in the country, opening doors for digital acceleration across sectors. The announcement about the new digital university and the renewed focus on digital learning, further presents an opportunity, especially to the fast-evolving Educational Technology sector. However, a definite plan on how this will pan out for all corners of India remains to be seen.
Moreover, digital will also be leveraged in the set-up and operation of tele-mental health centres, providing the necessary focus and access to mental health services to the Indian masses. This comes as one of the most welcome moves as it’ll contribute infinitely to the nation’s long-term growth.
Himanshu Arya, Founder and CEO: Grapes said “The Union Budget for the financial year 2022-23 has set the stage with an invigorated focus on ramping up the process of the digital revolution. The government’s focus on the digital ecosystem is a progressive move to render an inclusive landscape for job openings and entrepreneurial opportunities. The extension of tax incentives for startups for one more year will give a slight relief to the industry. I hope that the cash flow improves in the market. The Union Budget has various encouraging initiatives and is directed towards a more viable and flexible business ecosystem that completely aligns with the ideologies of Make in India.”
Vikram Tanna, COO, Mzaalo “As a next-gen blockchain-based entertainment platform, we are pleased to see that the government has prioritized digitization in this budget. The announcement of the Reserve Bank of India introducing its very own digital rupee is a sign of a future-ready approach for phenomenal growth. The use of blockchain technology further indicates the government’s increasing trust in new-age technology. We also welcome the introduction of a 30% tax on income from virtual digital assets. The move brings much-needed clarity on how the government views cryptocurrencies and should eliminate any fear the user/investor class might have had around the cryptocurrency ban. All in all, it is a growth-friendly budget with a positive outlook. We now await clarity towards the rollout of these measures in the upcoming days.”
Ravi Kumar, Founder of MadHawks a Digital Marketing Agency said “ ‘Optimal usage’ is what young and budding entrepreneurs must focus on with the current budget of 2022-23. The budget presented on February 1, 2022, can be termed as a growth-oriented budget harnessing the Aatmanirbhar Bharat by anticipating most of the expectations of the startup industry. Right from allocating Rs. 6000 crore to boost MSMEs and startups across India till capping of long term capital gains tax to 15%, it is promising to create huge momentum on the growth of the economy as a whole. Bootstrapped startup owners and aspiring entrepreneurs must try to make optimal use of the capped tax rate on capital gains by attracting both venture capitalists and retaining precious talents with the help of ESOP schemes.
The startup industry had all its eyes on our Honourable Finance Minister, Nirmala Sitharaman with several expectations like deferred tax payment on ESOP gains for the employees, tax exemption for an extended period since registration, easy access to capital funding, etc. Most of the aspects have been cleanly absorbed and satisfied with the Budget 2022. The 100% tax exemption on income for 3 years since registration, quickening the process of startup registration to one day, setting up an online portal for raising capital, setting up Rs. 500 crore for the “Start-up India Action” Plan is all promoting entrepreneurship and can make India number one in terms of startups around the world.
Budget 2022 – “An Action budget” in terms of building a robust and dynamic startup environment. The extension of 100% tax exemption on startups for another year, removing the capital limits on one-person companies, the extension of tax exemption on capital gains for investing in startups, and various other benefits can help Indian startups to beat the pandemic blues of the country. Apart from these exceptional benefits, the corporate surcharge reduction from 12% to 7% can be seen that the government is more focused on the revival of the economy. These small amendments introduced will highly contribute to the 9.2% expected economic growth of our country.”