Brands were expecting a boost to the manufacturing and infrastructure sector from Union Budget-2022. The budget proposal which gave emphasis on Aatmanirbhar Bharat Abhiyan and Makes in India initiatives seems to address the issue, the government announced concessions in the imports of capital goods for some products. The electronics, medical devices sector witnessed a reduction in custom import duties on intermediary products. The Union Budget which aims to boost infrastructure growth which in turn accelerates employment opportunities is set to boost the consumption level and accessibility.
Mayank Shah, Senior Category Head at Parle Products: “First of all, putting money in the hands of consumers helps, so they go out and buy products. So that was more on the front of ensuring that the demand remained robust given that we have gone through two years of the pandemic. That was something that industry expected, either by the tax cut or by increasing the slabs tax brackets or by probably increasing the standard deduction limit. Those were the things that we expected but not much has been done there.
However, on the second front of job creation, the government has done a lot. The budget talks about seven engines driven by PM GatiShakti that will boost employment and increase the number of jobs. The budget also talked about 60 new jobs to be created in the next five years. That is relatively a longer process compared to the first expectation which was putting money in the hands of consumers, which would have yielded immediate results. A 20,000-crore boost in transportation infrastructure will help in terms of job creation going forward.
Another thing the government would have ensured on the rural front was increased allocation to MGNREGA or direct benefit transfer. They chose the other way. In terms of rural demand, when you’re talking about putting money in the hands of rural consumers by increased MSP and increased MSP allocation, it is also going to have an impact on inflation because if you increase the MSP, that eventually is going to increase the cost of Agri products, primary inputs in food processing. So, procurement is going to be increased. The current challenge ahead of most FMCG companies, which is managing inflation, probably would be aggravated, so I consider it to be neutral. Probably placing this money in the hands of consumers through MGNREGA or DBT would have ensured demand to remain robust.”
Dinesh Chhabra, Chief Executive Officer, Usha International: “The Growth in GDP numbers and keeping the fiscal deficit within the promised boundaries is a reflection of the fact that the Government during these times of crisis has navigated the economy well. To further the efforts, the Union Budget 2022 – 23 has indeed offered some strong pillars for the nation’s economic recovery and growth. The various initiatives announced in line with the Government’s push towards enhanced Capital budget along with the digital thrust including the formation of digital currency, a big bet on 5G internet services, E-passport, along with digital resources for upskilling of rural areas will go a long way in furthering the socio-economic development of the country. Further, the extension on customs duty exemption on steel scrap by one year will provide a fillip to new businesses and MSMEs. Contrary to the perception Government hasn’t made the budget to bring short-term election benefits, rather this budget intends to write the future of “Bharat 100”.
“We at Usha, wholeheartedly welcome the relaxations announced concerning corporate surcharge, from 12% previously to 7% now. The Government’s provision to allow taxpayers to file updated income tax returns for an extended period is also appreciated. The Budget this year has provided a much-needed boost to Indian farmers with the announcement of direct transfer of MSP to their bank accounts, allowance of farmer drones for crop inspection, etc. These initiatives will prove to be beneficial in enhancing farmer & rural incomes. We are confident that the budget allocation for FY 2022-23 will provide a much-needed boost to the growth of the Indian economy. This budget clearly indicates the Government’s intent on revival from the pandemic-induced impact,” he added.
Ahmed ElSheikh, President, PepsiCo India: “Reviving economic growth, increasing consumption, and fostering investment to fuel post-pandemic growth have been key objectives for the government, and the Union Budget 2022 reflects this very intent. This year’s Union Budget lays forth a vision for India at 100. The Government is leading from the front by raising public sector spending to keep the economic recovery on track. Digitization combined with infrastructural creation will accelerate economic development, stimulate innovation and entrepreneurship and enhance living standards while keeping sustainability at its core. The increased outlay for PM Gati Shakti projects for multi-modal connectivity including 100 new railways logistics hubs coupled with steps like enhancing local oilseed production, extending the last date for starting production for new manufacturing units, encouraging alternate cropping will aid the growth of the FMCG sector and further strengthen Govt’s vision of an Atmanirbhar Bharat”
Sachin Jain, Managing Director, De Beers India: “We are pleased with the budget announcement for our sector, particularly the reduction of customs duty on cut and polished diamonds from 7.5% to 5%. This will spur greater demand for natural and real diamonds and also allow diamond companies to boost operations and, in turn, contribute to greater economic growth for the nation. The proposal to create a simplified regulatory framework to enable the use of e-commerce channels to export jewelry will help us seamlessly take forward our initiative to promote trade through the digital mode. This will bring down transaction costs and save time while enabling us to reach out and expand our customer base globally. Overall, we hope that the gems and jewelry sector continues to plays a pivotal role in the growth of the economy”.
Saugata Gupta, MD and CEO, Marico Limited: “With this Union Budget, the government has laid out a growth-oriented, future-focused blueprint for India. By prioritizing job creation, infrastructure growth and strengthening digital capabilities while making ‘inclusive development and ‘financing of investments’ two of the key focal points of the Budget, the government is successfully laying the groundwork for faster financial inclusion and expansion of the credit ecosystem.
It has undertaken some key initiatives targeted towards credit growth, farmer welfare, improving the health and education infrastructure, digital currencies and start-ups which will benefit young aspirational Indians. If executed well, the budget will trigger the virtuous cycle of economic growth and employment creation, leading to momentum in growth. I believe that the budget has several inclusive measures and policies that balance consumer needs with industry requirements. It encapsulates the spirit of an Atmanirbhar Bharat and takes strong steps towards fulfilling that vision.”