Industry leaders, particularly those in the MSME sector, are applauding the measures announced in the Union Budget 2024. The initiatives, announced by Finance Minister Nirmala Sitharaman, are seen as a major boost for innovation, job creation, and economic growth. The budget proposes a range of programs specifically targeted at supporting MSMEs and startups to flourish.

The abolition of the Angel Tax, the introduction of new credit guarantee schemes, and substantial allocations for infrastructure and skilling are viewed as catalysts for fostering a dynamic and sustainable economic environment.

Joseph Sudheer Reddy Thumma, MD & CEO of Magellanic Cloud, sees the new schemes for first-time hires and credit guarantees for MSMEs as positive moves. “These will support manufacturing and help MSMEs innovate and create jobs without collateral constraints,” he says.

He notes, however, that the increased Basic Customs Duty (BCD) on telecom equipment challenges the drone industry, stressing the need for local innovation. The Rs11 lakh crore for infrastructure and industrial parks will boost efficiency, while support for R&D through the Anusandhan National Research Fund aligns with their innovation goals.

For Khadim Batti, Co-Founder & CEO of Whatfix, the Union Budget 2024 is a major boost for tech and startups. “The abolition of Angel Tax is crucial for startups amid the funding crunch,” he says.

Batti also notes that simplified FDI rules and promotion of the Indian rupee will boost investor confidence. “Revised ESOP taxation will enhance talent retention and morale. The focus on skilling 20 lakh youth and upgrading 1,000 training institutes is key to building a future-ready workforce. This budget strengthens our belief in India’s $7 trillion economy potential by 2030 and supports the growth of the Indian SaaS sector,” he adds.

Pratap Daruka, CFO of Tredence, welcomes the abolition of Angel Tax, calling it a relief for startups and a boost for innovation and investment.

He commends the Rs2 lakh crore skill development package as a major step towards building a skilled workforce. However, Daruka stresses the need for a more focused approach to realise AI's full potential and attract global investments. “Increased R&D grants and tax credits are essential for developing cutting-edge solutions, creating millions of new jobs, and transforming existing roles,” he adds.

Mukul Goyal, Co-founder of Stratefix Consulting, sees the Union Budget 2024 as a strong move for MSMEs, startups, AI, and job creation. “The Rs22,000 crore for MSMEs could drive growth, but adding incentives for eco-friendly tech in the Credit Guarantee Fund would have been beneficial,” he says.

Goyal also welcomes the focus on ease of doing business but criticises the lack of GST rate changes. “Employment-linked incentives and the Rs2 lakh crore job creation fund are positive, but more emphasis on retraining for AI-related job displacement would be needed,” he adds.

Industry leaders praise the Union Budget 2024 for its potential to drive India's technological and economic progress, targeting key areas of growth. However, the true impact of these initiatives will become evident in the next 3-5 years.