A lot has been said by industry leaders and analysts regarding the Union Budget 2024-2025, including the new tax regime, employment schemes and the expected growth in the startup ecosystem. But what exactly has been said by the current government? Let’s find out.
The Union Budget 2024-2025 includes several initiatives aimed at boosting employment, skilling, and opportunities for the youth. Key measures include incentives for first-time employees, job creation in manufacturing, and support for employers through EPFO contributions.
A centrally sponsored scheme plans to skill 20 lakh youth over five years, upgrading Industrial Training Institutes and promoting internships in top companies.
Efforts to increase women’s workforce participation feature the establishment of working women hostels, women-specific skilling programs, and market access promotion for women SHG enterprises. Additionally, the government has abolished the angel tax for all classes of investors to enhance the start-up ecosystem.
For MSMEs, the budget emphasizes credit support and resilience through a credit guarantee scheme for machinery and equipment purchases and a mechanism to maintain bank credit during stress periods.
Mudra loan limits under the ‘Tarun’ category have been increased, and the turnover threshold for mandatory onboarding on the TReDS platform has been reduced. Other initiatives include setting up food irradiation units, establishing e-commerce export hubs, and launching a Critical Mineral Mission.
The development of Digital Public Infrastructure (DPI) applications aims to support areas like credit, e-commerce, education, and urban governance, further strengthening the digital and IT sectors.
Now lets hear from the tech leaders on the budget:
1.
Pankaj Jathar, CEO of NIIT Ltd. talked about the education, skilling and employment-related updates in the Union Budget 2024-2025. “The budget announcement has laid a strong foundation for advancing education, skilling, and employment opportunities and is truly commendable. The allocation of Rs 2 lakh crore for the five employment and skilling schemes, along with Rs 1.48 lakh crore for education, employment, and skilling, underscores the government’s dedication to the country’s youth and its commitment to propel growth.
The new centrally sponsored scheme aimed at skilling 20 lakh youth over five years will significantly contribute to fostering a skilled workforce. This significant step is the need of the hour to bridge the gap between education and the skills essential to equip the youth to be industry-ready. These initiatives will help us maximize our education and skilling efforts, propelling the next phase of growth for the Indian economy.”
2.
Debashis Chatterjee, CEO and Managing Director, LTIMindtree shared his views on the vision of Viksit Bharat and India’s steps towards developing a skilled workforce. “The budget’s emphasis on fostering a skilled workforce through initiatives such as the comprehensive internship program is particularly noteworthy. At LTIMindtree, we are deeply committed to nurturing talent and driving technological innovation. By equipping young talent with practical experience, these initiatives will fully empower them to make substantial contributions to the nation’s progress.
We view this year’s budget as a catalyst for accelerating our growth trajectory and contributing to India’s digital transformation journey. Our focus on emerging technologies and domain expertise seamlessly aligns with the government’s vision to create a knowledge-based economy.”
3.
Amit Khatri, Co-Founder, Noise emphasized skilling and development initiatives, and how removing Angel-tax is going to boost the startup ecosystem. “The Union Budget 2024 presented by Finance Minister Nirmala Sitharaman is a visionary step towards inclusive growth, with a strong emphasis on manufacturing, upskilling, and women empowerment. Youth and participation of women in the workforce hold the key to India’s success.
To this end, the focus on extensive training and skill development initiatives demonstrates a clear commitment to boosting employability and productivity. By linking job creation in manufacturing to first-time workers and offering EPFO incentives, the government is paving the way for a robust manufacturing ecosystem, creating 4 crore jobs over the next five years. It is certainly a commendable initiative to boost local manufacturing. Additionally, offering internship opportunities in the top 500 companies to 1 crore youth is a strategic move that will equip our young population with the skills and experience necessary to thrive in a competitive global economy.”
4.
Talking about making India the global powerhouse in the startup ecosystem Bipin Preet Singh, Co-founder and CEO at MobiKwik commented, “India’s visionary Budget 2024 has resonated positively with the masses, focusing on employment, skilling, and MSMEs, thereby laying a strong foundation for the next five years. By introducing a new credit guarantee scheme to offer term loans to MSMEs and raising MUDRA loan limits, the budget aims to support and strengthen the MSME ecosystem. Additionally, eliminating the angel tax will help build a healthier startup ecosystem with higher access to capital and a lesser burden on investors.
The long-term capital gains tax (LTCG) scheme, with its increased exemption limit to Rs 1.25 lakh, will offer investors the opportunity to earn higher tax-free gains, promoting greater investment participation and enhancing overall tax efficiency. With this move, the startup industry will witness more innovation and development across different sectors, showcasing India as a global powerhouse in the startup ecosystem. Furthermore, the government’s emphasis on youth with job creation and skilling programs will boost India’s economic growth. Overall, the union budget underscores a strategic approach towards long-term economic resilience and innovation.”
5.
“The removal of angel tax is a welcome move for India’s startup ecosystem. This, coupled with the establishment of a ₹1,000 crore VC fund for the space economy, will foster innovation. The budget’s focus on manufacturing, with the introduction of plug-and-play industrial parks, is progressive. MSMEs will benefit significantly from the credit guarantee scheme, new assessment models by PSU banks, and increased Mudra loan limits.
The substantial allocation of ₹11 lakh crore for infrastructure especially nature resilient is crucial for building a Viksit Bharat. The strategic shift towards nuclear energy as a major power source is visionary. Finally, the emphasis on cultural heritage through the development of the Vishnupad, Mahabodhi temple corridors, Rajgir, and Nalanda is a welcome addition,” said Rahul Garg, CEO & Founder Mogilx.
6.
Shashank Avadhani Co-founder & CEO, Alyve Health, said “Alyve Health welcomes the government’s decision to abolish the angel tax in the Union Budget 2024-25. This forward-thinking move will unlock significant growth potential for startups across India. By removing this financial barrier, the government has demonstrated its commitment to encouraging innovation and supporting entrepreneurs. We believe this policy change will attract more investments into early stage companies.
The budget for FY24-25 exempts three more cancer medicines from customs duty which will bring down the cost of treatment significantly. The healthcare sector is to get a ₹89,287 crore budget allocation in 2024–25, up from ₹88,956 crore in 2024-25 which will enhance healthcare infrastructure in our country.
In the Economic Survey, the government has focused on the future of AI, and deep-tech startups to create opportunities for deploying AI and other cutting-edge technology in the healthcare sector. This move will encourage investments in the broader deep tech space and specifically in the health tech sector.”
7.
Rahul Paith, CEO, MATH, said, “The removal of the Angel Tax is a positive move for the startup ecosystem, as it enhances the investment landscape for emerging technologies like AI and ML. The introduction of a ₹1,000 crore venture capital fund for the space sector, along with the Anusandhan National Research Fund and a ₹1 lakh crore financing pool, underscores the government’s commitment to advancing high-impact technologies.
However, while these steps are encouraging, the startup community was hoping for additional measures that could further stimulate investments in transformative technologies such as AI and Gen AI. To fully harness these innovations, continued support beyond the India AI Mission will be crucial. We anticipate that future policies will address these needs and bolster the growth of the technology sector.”