Majority of India Inc expects the Union Budget 2021-22 to focus on giving a boost to infrastructure while offering simpler tax regimes to promote ease of doing business, according to a survey conducted by Deloitte Touche Tohmatsu.
Of the 180 survey participants, 68% industry leaders said they were positive about India’s economic revival. The mass vaccination drive, the government’s stimulus packages and other policy changes, focused attention to infrastructure, and continuing efforts on digitisation will be key areas helping India revive and thrive, the survey found.
Respondents felt that focusing on the infrastructure sector with timely and adequate financing, as outlined under the National Infrastructure Pipeline (NIP), should be a priority area in this budget. About 60% survey respondents cited that incentivising infrastructure investments will provide the desired impetus to the sector.
Extending R&D incentives, increasing FDI limit in different sectors and further simplifying its processes, along with supply chain reforms, would further enhance the programme’s effectiveness. Increasing the credit support to MSMEs would help the industry rebound sooner, the survey found.
Sanjay Kumar, Partner and Leader Public Policy, Deloitte India, said, “Schemes such as Aatmanirbhar Bharat and PLI have done especially well in supporting self-reliance and stabilising the country’s economic growth. While these schemes have helped the manufacturing, life sciences, and consumer products sectors the most, the rest of the industry is also positive about stimulating their respective businesses through injection of R&D spend and income-linked incentives.”
About 49% respondents also highlighted the role of technology and digitisation in this aspect, in addition to implementing an online single-window system.
Improving land and labour laws, and easier compliance for cross-border trade would be other enablers, the survey highlighted.
About 45% respondents believe that creating a new fund to finance projects and attracting sovereign funds through various incentives are effective means to inject capital in the infrastructure sector to ultimately boost the economy.
Industry experts and survey respondents also suggested that privatising public-sector banks and granting licences to financial institutions could help infuse capital and increase competition.
