Union Budget Expectations: TS industries seek fiscal sops, cheaper credit

Hyderabad: The Corona pandemic wreaked havoc on the industrial sector. Ahead of the presentation of the Union Budget 2021-2022 in the Lok Sabha by Union Finance Minister Nirmala Sitharaman on February 1, the Telangana industrial sector has come out with budget proposals to revive the sick industry.

Telangana Industrial Federation and Small and Medium Entrepreneurs' (SMEs) associations have demanded that the Centre simplify the GST (Good and Service Tax) by reducing the slabs to two from the current four.

The associations said the electronics and electrical industry bore the brunt of 18 per cent GST on production which resulted a heavy burden to run the industry and earn profits. "Without the GST tax reduction, the survival of many industries in Telangana will be unsure," federation secretary M Gopal Rao said.

The other big challenge before the industry is availability of bank loans. The higher interest rate between 8 and 12 per cent collected on loans were eating away the low profit margins earned by the managements in the current situation.

The 'stimulus package' announced by the government to tide over the financial crisis arising out of the Corona lockdown was no use for the industry, particularly the small and medium units. Banks were collecting the moratorium loan instalments at one go. The industrial bodies want the Centre to provide loans at low interest and collect the instalment money in a flexible way, Rao stated.

He explained that the other main demand is creation of a national-level facility to promote Indian goods at world level under the Make In India project. The quality of goods produced in the country should be upgraded to meet the international standards and ensure the other countries buy the products. China has created a facility to promote every product in the world market. Similarly, India should help the manufacturing industry.

The federation leader observed that the major hurdle before small and medium industries is the availability of skilled workforce and providing decent wages to the workers. The government should come out with a plan of action to help SMEs get adequate talented workers and earn more profits by creating a big marketing facility to sell products everywhere in the country. The price stabilisation of the products in the competitive market is essential to earn good profits, he felt.

WANTED: A CLEAR ROADMAP

It will be a critical Budget as India battles the twin challenges of economic slowdown and COVID pandemic.We hope the Budget lays down a clear roadmap for a higher Innovation Quotient and sets a vision to carve India into an Innovative Economy by 2050. This would require India to grow from 0.5 % of R&D spend to the GDP to improve to 1.5% by end of this decade and reach 2.5-3% by 2050.

At Cyient, we are hopeful of an increased Research and Innovation enabling more IP to come from India in the budget from the Finance Minister. Companies are also eagerly awaiting a central Research & Innovation Fund to help build up intellectual property out of the country. This will not only help domestic technology companies but attract global clients to set up their engineering centres out of India.

At Cyient, we have outlined areas of Sustainable Mobility, Smart Manufacturing & Digital plants, Clean plants for Semicon/Pharma industries, smart Healthcare as areas of innovation/IP internally. We would like to request to create innovation clusters across India and help realize the Vocal for Local commitment.

- Karthikeyan Natarajan, President and Chief Operating Officer, Cyient

SUSTAIN DIGITAL GROWTH

2020 has been an unprecedented year and we hope that the upcoming budget will address the challenges faced by businesses and propel the economy towards faster recovery and growth. Digital technology and connectivity continue to be the cornerstone of India's growth and leadership.

The pandemic accelerated the shift to digital and we need to maintain this growth momentum, as it will have a cascading effect on creating efficient businesses, new jobs and all-round development. R&D (Research and Development) spending must be increased in order to accelerate digital transformation and jumpstart education with a focus on next-gen technologies, skilling, reskilling and upskilling programs, to nurture our young talent pool and thus accelerate our journey towards an 'Atmanirbhar Bharat' (Self-reliant India).

We also hope to see focused initiatives to boost consumer sentiment, accelerate infrastructure development, move towards a lower interest rate regime and increase investments in key areas including healthcare and education. From an IT (Information Technology) perspective, we expect the government to create a fund for product companies along with extended SEZ (Special Economic Zone) benefits in the new normal of remote working, besides nurturing an ecosystem for deep tech startups in areas including blockchain, artificial intelligence, augmented reality and virtual reality.

India is on the path of a higher growth trajectory and the vision of a $5 trillion economy can be achieved with a focus on economic growth and development." - CP Gurnani, MD & CEO, Tech Mahindra

ACCELERATE DIGITAL TRANSFORMATION

"We expect the budget to act as a much-needed catalyst for boosting demand, curbing inflation and thereby reviving the economy. There is a need to undertake definite policy measures and provide fiscal stimulus to ensure financial recovery and spur economic growth, specifically across, sectors, like healthcare, EdTech, Infrastructure and Manufacturing.

We are also hopeful that the budget will address measures essential for an accelerated digital transformation. This includes investment in R&D, automation technologies, skilling and development of a talent pool trained in digital age skills which will help accelerate the pace of development." - Rajiv Bhalla, MD, Barco India