Live Blog: How MSMEs Reacting to Union Budget 2024 of Modi 3.0

The Union Budget 2024 presents several initiatives aimed at supporting the Micro, Small, and Medium Enterprises (MSMEs) sector.

Key Highlights:

1. Credit Support: An increase in the allocation for the Credit Guarantee Scheme to provide easier access to credit for MSMEs. The government aims to reduce the credit gap and enhance the flow of funds to small businesses.

2. Tax Relief: Simplification of tax compliance procedures and potential reduction in the corporate tax rate for MSMEs, easing the financial burden and encouraging growth and formalization.

3. Digital Infrastructure: Investment in digital infrastructure to support MSMEs in adopting digital tools and technologies, thereby enhancing their competitiveness and market reach.

4. Skill Development: Enhanced focus on skill development programs tailored for MSMEs to upgrade the skills of their workforce, promoting productivity and innovation.

5. Export Promotion: Measures to boost exports by MSMEs, including improved access to international markets, subsidies, and support for meeting global standards.

6. Ease of Doing Business: Initiatives to streamline regulatory processes and reduce bureaucratic hurdles, making it easier for MSMEs to operate and expand their businesses.

7. Green Initiatives: Encouragement for MSMEs to adopt sustainable practices with incentives for green technologies and environmentally friendly operations.

These measures aim to bolster the MSME sector's growth, improve their access to resources, and enhance their overall contribution to the economy. 

Stay here on this SMEStreet Live Blog for the latest Industry reactions on Modi 3.0's Union Budget 2024 from MSMEs' Perspective.

Jul 24, 2024 17:18 IST
Budget 2024 Highlights ELI and Apprenticeship Scheme for Job Creation
Mr. Piyush Doshi, Operating Partner of Foundation for Economic Development.
"The budget can be analysed as government statement of income and expenditure or as a policy signal.
As a statement of accounts, the budget largely maintains continuity in terms of fiscal consolidation and high capital expenditure which is positive. The fact the government has not enhanced unproductive spend like subsidies in reaction to election result is a welcome sign as well.
As a policy signal, the budget makes all the right noises. The FM in her speech emphasised need for reforms to increase competitiveness across factors of production like land, labour, capital, power etc. However, there is no immediate bold announcement on reforms and specifics in most cases will be worked out later.  As such, it is still to be seen if intent translates into action.
One significant announcement that stands out in the budget is ELI and apprenticeship scheme targeted at job creation. While it is unclear if the budgeted amount will move the needle in a significant way, the intent of incentivising job intensive manufacturing is welcome compared to traditional focus on capital intensive manufacturing.
Overall it is a budget of continuity with some signal of intent in the right direction."



Jul 24, 2024 17:13 IST
SaaS Provider Supports MSME Growth Amid Budget Focus
- Prashant Singh, Co-founder and Chief Operating Officer, LeadSquared.
"The Budget's strong emphasis on MSMEs is a welcome move. Enhanced credit guarantees, increased Mudra loan limits, and support for MSMEs will uplift this vital sector. As a SaaS provider partnering with MSMEs, we're excited about the potential growth this brings. The focus on digital infrastructure and skilling aligns perfectly with our mission to empower small businesses with cutting-edge sales and marketing tools."



Jul 24, 2024 17:11 IST
Platform to Support Manufacturing Network Expansion in Budget 2024
– Abhishek Shukla, SVP - Growth, LeadSquared
"The Union Budget 2024's focus on unlocking India's manufacturing potential is a strategic move towards achieving economic self-reliance and growth. The allocation for infrastructure development and technological advancements will be instrumental in stimulating the industry. We are happy to support manufacturing players with our platform to help them efficiently engage & expand their dealer - distributor, sales, and influencer network" 



Jul 24, 2024 15:51 IST
Budget 2024 Prioritizes Job Creation and Skilling
 Nirmit Parikh, CEO & founder, apna.co,
 
“The Union Budget FY2024-25 underscores job creation as a critical priority, mirroring our shared focus on skilling and employment. The substantial Rs. 1.48 lakh crore allocation for education, employment, and skill development marks a significant stride forward. Introducing five schemes aimed at skilling over 40 million youth within five years, backed by an outlay of Rs. 2 lakh crore, is a monumental step toward shaping a skilled and future-ready workforce.

Moreover, the initiative to establish working women hostels and crèches in collaboration with the industry is a progressive move that will enhance workforce participation among women and promote gender equity. The partnerships for women-centric skills programs and the provision of market access for female SHG businesses are especially commendable, empowering women to play a more significant role in our economy. The three employment-linked incentive schemes, which support first-time job seekers, job creation in manufacturing, and employee support, are poised to drive significant employment growth.

Additionally, the emphasis on accelerating the growth of the rural economy, supporting MSMEs, and promoting tourism will further amplify employment opportunities across diverse sectors. This comprehensive approach reflects a visionary strategy to build a robust, inclusive, and dynamic economy that benefits all.”



Jul 24, 2024 14:32 IST
Union Budget 2024 Supports Transition from Education to Employment
Mr. Prabhakar Azad, Chief People and Process Officer, Ashwin Sheth Group, 
 
"The Union Budget 2024 lays a strong foundation for human capital development, vital for real estate growth. The substantial allocation of Rs 1.48 lakh crore for education, employment, and skill development underscores the government's commitment to nurturing India's workforce. We look forward to the comprehensive internship scheme designed to provide opportunities for one crore youth in 500 top companies over the next five years. This initiative is poised to bridge the gap between academic learning and practical industry experience, creating a more skilled and job-ready workforce. Such a workforce is crucial for sectors like real estate, where practical skills and experience are highly valued. The government's plan to incentivize 30 lakh youth entering the job market by offering a one-month PF contribution is a welcome move. This initiative will ease the transition from education to employment, supplemented by the internship allowance of Rs. 5,000 per month and a one-time assistance of Rs. 6,000. These financial supports are vital for young professionals embarking on their careers. As a employee centric company committed to diversity and inclusion, we applaud the budget's focus on increasing women's participation in the workforce. These measures will not only help develop a skilled workforce but also create a more diverse talent pool, which is essential for innovation and growth in the real estate sector”.



Jul 24, 2024 14:25 IST
Focus on Urban Planning and Infrastructure Across 100 Cities
Mr. Ashwin Sheth, Chairman and Managing Director, Ashwin Sheth Group
"The Union Budget 2024 marks a momentous breakthrough for urban development and housing reassuring a promising future for the real estate sector. The comprehensive focus on efficient urban planning, including transit-oriented development and enhanced infrastructure for water supply, sewage, and waste management across 100 large cities, will elevate the quality of urban living. The substantial Rs. 26,000 crore investment in road connectivity projects is set to create a new growth corridor, significantly boosting real estate demand in emerging regions. We applaud the government's progressive initiative to urge states to moderate stamp duty rates and offer further reductions for properties purchased by women. Coupled with the proposed interest subsidy scheme for urban housing loans, this will revolutionize homeownership by making it more accessible. Furthermore, the commitment to developing a transparent and efficient rental housing market is a commendable stride that will benefit both property owners and tenants. As a leading real estate developer, we recognize these measures as transformative catalysts. The Indian real estate sector, poised to reach $1.04 trillion by 2029 and contribute 13 percent to the GDP by 2025, stands to benefit immensely from this holistic and forward-thinking approach to urban development and housing."



Jul 24, 2024 14:02 IST
E-commerce Export Hubs Established for MSMEs in Union Budget 2024
Divyesh Dalal, Managing Director & Head – Global Transaction Services, SME & Institutional Liability Business, DBS Bank India
“The measures announced in the Union Budget underscore the government's commitment to empowering MSMEs, the backbone of our economy. The introduction of the credit guarantee scheme is an encouraging step towards making capital more accessible. Additionally, the provision of collateral-free term loans for purchasing machinery and equipment will tangibly enhance the operational capabilities of MSMEs by enabling technology upgrades.
 
Further, lowering the turnover thresholds mandatory for onboarding on the TReDS platform will allow more MSMEs to access the benefits of this system. The establishment of e-commerce export hubs is poised to further equip enterprises with the tools and support needed to expand into international markets. By making their products more accessible globally through e-commerce platforms, Indian businesses can tap into new opportunities with offshore customers across markets. DBS Bank India is well-positioned to support MSMEs given the focus on supporting the sector.”



Jul 24, 2024 13:48 IST
Logistics to Gain from Union Budget 2024 Growth Initiatives
Mr Ketan Kulkarni, Chief Growth Officer, Allcargo Group

“Finance Minister Nirmala Sitharaman, provided enough fuel for India’s current growth ride. With the budget focussing specially on job creation and skilling, agriculture, infrastructure, research and technology, the ride should gain momentum. Without changing the Capex allocation which was significant compared to the revised estimates, increased outlays in many sectors like infra and manufacturing will boost spending. The government has also reiterated its determination to pull down the fiscal deficit in the coming years. As every sector has something to cheer about in general, logistics also should gain from the overall growth trajectory. The positive spurs makes the budget balanced, positive and forward-looking”.



Jul 24, 2024 13:21 IST
Union Budget 2024 Eases Fiscal Pressures on E-commerce
Natasha Tuli, Co Founder & CEO, Soulflower

This is a landmark budget for the e-commerce industry. The push by the Government on e-commerce will not only boost the industry but also boost India's overall economy. The reduction in Tax Deducted at Source (TDS) for e-commerce operators, from 1% to 0.1%, will alleviate fiscal pressures on e-commerce enterprises. This significant decrease will lessen the load on working capital and is expected to create a more favorable environment for growth.
These initiatives are expected not only to sustain but bring ecommerce to scale, which in turn will drive India’s economic growth We congratulate the Government for Budget 2024 and wholeheartedly welcome it



Jul 24, 2024 13:14 IST
Manufacturing Sector to Benefit from Union Budget 2024 Measures
Rajesh Khosla, CEO, AGI Greenpac, 

“The Union Budget 2024 presents a promising outlook for India’s manufacturing sector. Increased allocations for infrastructure and technology are significant steps towards solidifying India’s position as a global manufacturing hub.
The focus on employment-linked skilling initiatives is particularly encouraging. By incentivizing job creation, the government is empowering young talent and fostering a more productive workforce.
We are optimistic that these measures will create a robust manufacturing ecosystem and contribute to India's economic growth. AGI Greenpac is well-positioned to capitalize on these opportunities and further expand its operations.”



Jul 24, 2024 12:54 IST
Renewable Power Goal Set at 500 GW by 2030 in Union Budget 2024
Mr. Abhinav Jain, Co-Founder & CEO, Almonds AI

"The Union Budget 2024 has delivered a landmark decision for India's startup ecosystem. The abolition of angel tax for all investor classes is a game-changing move that signals the government's unwavering commitment to nurturing our nation's innovative spirit. This pivotal reform will inject much-needed momentum into our startup landscape, which has faced headwinds recently. By removing this significant barrier to investment, the Budget 2024 is not just opening doors – it's constructing highways for capital to flow into groundbreaking ideas. This bold step, building upon previous initiatives like the Startup India program, positions India to regain its growth trajectory in the startup space. The Union Budget 2024 sends a clear message: India is not only open for business but is actively cultivating the next wave of entrepreneurs who will propel our economy forward."



Jul 24, 2024 12:15 IST
Homeowners to Receive Subsidies for Solar Energy Adoption
Saurabh Marda, Co-founder and Managing Director Freyr Energy
The recent budget has been highly favorable for the energy sector, with the government setting an ambitious goal of achieving 500 GW of renewable power by 2030. A key component of this plan is encouraging homeowners to adopt solar energy, facilitating a swift transition to solar power. To support this, the government has allocated ₹70,000 crores in subsidies for homes that switch to solar energy. This is a crucial and forward-thinking initiative for the country's future, and we express our gratitude to the government for taking this significant step.



Jul 24, 2024 12:13 IST
Union Budget 2024 Focuses on Agriculture and Drone Industry
Prem Kumar Vislawath - CEO and Founder, Marut Drones
“The allocation of ₹1.52 lakh crore for agriculture and allied sectors by the Finance Minister underscores a pivotal commitment to bolstering India's agricultural resilience. The emphasis on developing climate-resistant varieties and introducing 109 new high-yielding varieties is a forward-looking stride towards sustainable agriculture. Additionally, the promotion of farmer producer organizations, cooperatives, and startups heralds a new era of inclusive growth and innovation in the agricultural sector.
Exempting lithium imports from customs is a bold step demonstrating India's commitment to strengthening the drone manufacturing sector. Lithium, crucial for drone battery production, will now bolster domestic drone manufacturing, underlining the government's support for this industry.
The abolition of the Angel Tax for investor classes is a significant boost for startups, affirming the government's unwavering support for entrepreneurship and fostering a conducive investment environment.
 However, we look forward to enhanced subsidies on agricultural machinery, including drones, as a critical step towards modernizing our farming practices.”



Jul 24, 2024 11:56 IST
Union Budget 2024 Promotes Growth in Ceramics and Tiles Manufacturing
Mr. Satyendra Prasad Narala - Managing Director, Regency Ceramics
“The Finance Minister's announcement of a ₹10 lakh crore investment in urban housing through PMAY Urban 2.0 is a significant boost for India's real estate sector and related industries such as Ceramics and Tiles Manufacturing. This substantial infusion, including ₹2.2 lakh crore to rejuvenate the affordable housing segment and is expected to drive demand for construction materials and stimulate growth in sectors like ceramics, fostering innovation in construction technologies for affordable housing. 
Moreover, the enhanced focus on middle-class families is likely to encourage diverse housing types and urban design solutions.
In tandem with this, the focus on MSMEs is commendable. The introduction of a credit guarantee scheme for MSMEs in the manufacturing sector, along with support for E-commerce export hubs, will fuel growth and competitiveness. However, while welcoming these measures, we urge additional support for sectors like Ceramics to ensure sustainable growth.”



Jul 24, 2024 11:53 IST
Energy Transition and Sustainability in Focus for Data Centres
Mr. Sumit Mukhija - Executive Director and Chief Executive Officer, STT GDC India says, 
“The Union Budget 2024 outlines a forward-looking vision for the digital development of India. The government's commitment to investing more than ₹11.11 trillion in infrastructure, including digital infrastructure, aligns perfectly with the increasing needs of our data-focused economy. STT GDC India is especially enthusiastic about the emphasis on AI and innovation with initiatives such as the ₹1 lakh crore funding pool for private sector-led research. The focus on training 41 million young people in 5 years with a budget of ₹2 trillion will establish a strong pool of talent for the technology sector. The policy document aligning energy transition pathways with employment and sustainability reflects our dedication to eco-friendly data centres. As a leader in data centre services, STT GDC India is in a position to have a significant impact on aiding India's digital transformation and sustainable growth agenda." 



Jul 24, 2024 11:31 IST
CGTMSE Expansion in Budget 2024 to Support MSMEs
Mukul Goyal, Co founder of Stratefix Consulting

“The Union Budget 2024 presents an ambitious framework aimed at revitalizing India's economic landscape, particularly for MSMEs, startups, artificial intelligence, and job creation. With a proposed allocation of ₹22,000 crore for the MSME sector, this budget has the potential to catalyze significant growth and innovation.

 However, while the expansion of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) is commendable, it could have been further enhanced by introducing specific incentives for eco-friendly technologies, which are crucial for aligning economic growth with sustainability.

The budget's focus on ease of doing business is promising, with measures to streamline regulatory processes and extend tax holidays for startups. Yet, the absence of substantial changes in GST rates is a missed opportunity. Simplifying compliance and reducing the GST burden on essential goods for MSMEs would have provided immediate relief and improved cash flow management.

Moreover, while the introduction of employment-linked incentives and a ₹2 lakh crore allocation for job creation is noteworthy, the framework for skill development remains insufficient. A more robust approach to job-ready education and targeted training programs is essential to bridge the growing employability gap, particularly in high-demand sectors like AI and renewable energy.

Additionally, the budget lacks a comprehensive strategy to address the potential job displacement caused by AI advancements. A proactive approach, including retraining programs and direct benefit transfers for affected workers, could have been beneficial.

In conclusion, while the Union Budget 2024 lays a strong foundation for growth, it is imperative that the government prioritizes effective implementation and creates synergies across sectors. By addressing these gaps, we can ensure that the coming fiscal year transforms not just the economy, but also the lives of millions of Indians."