The annual Budget 2021 planning process is underway. Last year hit everyone like a tonne of bricks. Not only did the COVID-19 pandemic deal a crippling blow to the economy, it left millions jobless. A series of cyclones, locust outbreaks and floods led to further loss of life and property in 2020.
Budget 2021 Corporate Expectations
Companies worldwide were forced to adapt or perish. Remote working became the norm for office goers and factories shut down temporarily. The Union Budget 2021 might not be a magic wand but it could act as a soothing balm for our woes. We quizzed corporates and development experts on what they want FM Nirmala Sitharaman to consider. Says Dr. Manu Gupta, Co-Founder – SEEDS: “COVID-19 has indeed brought a paradigm shift in strategies in the CSR space with focus on public health. In 2021, we need to pave the way for recovery and rebuilding based on green growth principles. The pandemic has also laid bare the risk implications on socio-economic structures from new-age large-scale complex disasters.”
Boost Smart Agriculture
Says George Rajkumar, Country President, Grundfos India, “As we venture into the new fiscal year, we anticipate a further adoption of solar power into the Indian agricultural landscape through initiatives like the PM KUSUM Scheme. Last year’s budget allocation of Rs. 22,000 crores for the power and renewable energy sector was a major push for the country’s journey towards leveraging sustainable sources of energy. A key aspect that the Government also needs to focus on in tandem should be upgrading the dynamics of the irrigation infrastructure, incentives to the farmers to save energy and water through smart and efficient pumps and motors.”
Technology hubs for MSME cluster
Alok Bansal is MD and Country Head of Visionet wants more push for MSMEs through technology hubs. Says he, “With technological disruption gradually becoming a catalyst for the rise of MSMEs and startups today, it is expected that the government will make the necessary investments in technology hubs, which in turn will help in strengthening emerging technologies like AI, machine learning, and the Internet of Things (IoT). As the country is amidst a boom in digital technology adoption, this year’s Union Budget needs to make way for relevant measures to ensure that the right amount of thrust is given to tech build-up, favorable tax policies, and other opportunities will spell progress for the MSMEs.”
He adds that the government should pay attention to employing technologies that can be used to upskill or reskill the workforce employed by India’s MSME sector. Specialized tech centers can be set up and operated by the government and industry groups to equip the workforce with the required skills and perform AI-empowered hybrid jobs. Such interventions by the government have numerous upsides to them, starting with increased earning potential that will pave the way towards the strong economic growth of the MSME sector.
Reduce Individual Income Tax
For people to spend more so that the economy bounces back, Vikram Agarwal, Managing Director, Cornitos says that Individual Income Tax should be reduced. “Currently there is upto 47% Income Tax on Individuals and 18% GST on products, hence paying 65% Taxes in totality.”
Mr. Agarwal also feels that if India is to become a leader in the food business, the Union Budget 2021 should provide higher allocation of funds for food processing units and tax incentives for exports of food items. “To facilitate investment in the food processing industry, any additional capital investment of more than 50% of existing book value of plant and machinery should be treated as new investment and should also be eligible for a five-year tax holiday, under section 80IB (11A),” he says.
Investment in Healthcare Crucial
Preventive health check-ups can bring down the disease burden substantially with their early detection and treatment. RN Mohanty, CEO at Sightsavers India, says, “With the pandemic raging, we expect higher spending on healthcare in Union Budget 2021. The healthcare sector needs immediate attention, especially because most people do not have access to it. Apart from vaccination, government funding will strengthen the healthcare system at different levels.
Educationists want ‘Back to School’ campaigns
According to UNICEF, education for 270 million children in India has been disrupted by the world’s largest school closures. In this context, an Oxfam study says teachers fear that a third of the children might not return even after schools reopen. AK, Srikanth, CEO of KLAY network of preschools and daycare centres says, “While the NEP promises to improve budgets allocated towards education from the current 10% to 20% in 2030, a large chunk of this should immediately fund States for aggressive ‘Back to School’ campaigns. This includes supporting safe school reopening in a calibrated manner and efforts towards ensuring there are no dropouts through rigorous awareness campaigns.”
Adds Dr. Sanjay Gupta, Vice Chancellor, World University of Design, “The past one year has highlighted the value of digitization and remote work environment. Schools and colleges have been no exception. It thus makes it evident that there will be high expectations from the government to provide a strengthened internet groundwork and an even tougher data protection as more and more educational institutes will look at the medium to reach out to students, to teach and to help students get past their curriculum; thereby requiring students’ information to be critically guarded.”
Meanwhile, Mr. Srikanth sees a hybridized model of education being the future. He says, “We look forward to government support to ensure access of the right tools and resources in light of the transformed modality of education delivery.”
Sums up Dr. Gupta, “We need to invest in enhancing resilience for sustainable impacts of growth. This would mean increasing the quantum and flexibility in funding for covering risks to social and economic security of the most vulnerable communities. Communities should be able to better anticipate and if needed switch livelihoods, access to food, education, health and shelter to avoid possible losses. Civil Society Organizations can play a critical role in ensuring no one gets left behind.”