What You Can Learn From Budget 2023 To Build A Fruitful Life

Honorable Finance Minister Nirmala Sitharaman presented the full budget of PM Narendra Modi government on February 2nd 2023. During her Budget allocation, the minister said that the government’s ‘vision for the Amrit Kaal adds a technology-driven and knowledge-based economy including strong public finances, and a robust financial sector’.

“The Budget 2023 presented by Hon'ble Finance Minister Smt. Nirmala Sitharaman was very progressive and rightly backed by the tech-driven Amritkaal Vision. The government's vision to "Make AI in India and Make AI Work for India," as well as its emphasis on strengthening AI infrastructure through the establishment of three excellence centers, will provide a significant boost to the Indian technology sector. We welcome the resolution of integrating 100 labs in engineering institutions for developing apps using 5G services, which will open a new door of opportunities, business models, and employment potentialities. Being a digital engineering company that is constantly thriving on technological innovations to support the data governance practices of businesses, we look forward to the national governance policy that will be brought out to unleash innovation and research.”?said Rajesh Sinha, Founder and Chairman, Fulcrum Digital.

The Government, led by Honorable Narendra Modi, the Prime Minister of India early to the budget presentation stated that the budget focuses on economic growth and job development and reduction of the fiscal deficit, and Union Finance Minister Nirmala Sitharaman stated that the Budget in Parliament before the 2024 election and mentioned the enhanced capex of INR 10 lakh crore for the development of infrastructure which is at 3.3 percent of the GDP. Let us read about the budget and what it presents to the people.

Majestic Bits Of Budged 2023

Agriculture - Digital Public Infrastructure

Digital public infrastructure for the development of the agriculture sector gets built as an open source, open standard and interoperable public good. This enables, farmer-centric solutions through relevant information services for crop planning and health, improved access to farm inputs, credit, and insurance, help for crop estimation, market intelligence, and support for growth of agri-tech industry and start-ups.

Digital Payments

Digital payments get to find wide acceptance. In 2022, they include an increase of 76 percent in transactions and 91 percent in value. Fiscal support for the digital public infrastructure will continue in 2023-24.

Fintech Services

Fintech services in India have been facilitated by our digital public infrastructure including Aadhaar, PM Jan Dhan Yojana, Video KYC, India Stack and UPI. For enablement of more Fintech innovative services, the scope of documents that are available in DigiLocker for individuals will get expanded.

Positivity Of Influence

“The government announced various investment-based programs across crucial infrastructure sectors, including urban development, logistics, technology ecosystem and green projects. At the same time, focusing on reaching the last mile, empowering fintechs, and tax incentives strengthen its inclusion agenda. A host of initiatives around data and information repositories (National Financial Information Registry, Common Business Identifier, KYC Simplification, Central Data Processing Centre, etc.) will lead to an efficient, secured and integrated data access ecosystem. The Insurance sector will gain from the increased economic activities and greater ease of doing business. At the same time, announcements such as vehicle replacement policy, Digital Public Infrastructure for Agriculture, a higher rebate on personal income tax and a more significant focus on public health will also substantially impact the non-life insurance sector. Being now the most populous country in the world, India has built a robust foundation comprising of demographic dividend, economic stability, tamed inflation, improved incomes, phygital distribution network and above all, better awareness towards insurance. The success of health insurance in the past decade – backed by strong government resolve to offer low-cost access has set the right context for the sector. We believe the industry has just scratched the surface and will ride on a high degree of customization and product innovation in the coming years”, said, MS Sreedhar, MD & CEO, Royal Sundaram General Insurance Co. Ltd,

Education Propositions

“Provisions like the establishment of three centers of excellence for Artificial Intelligence in top educational institutions noting that 'Make AI in India' and to 'Make AI work for India' will support the creation of a stronger technology infrastructure in the country. This will further boost the government’s vision of ‘Digital India’ and ‘Atmanirbhar Bharat’. That being said, Budget 2023 amply highlights the greater focus that the government has placed on string digital infrastructure and technology at large. And we are hopeful that today’s announcement will have an inherently positive effect on the sector,” Parag Khurana, Country Manager, Barracuda Networks India.

“The latest Union Budget for FY 2023-24, presented by Finance Minister Smt. Nirmala Sitharaman places a strong emphasis on talent development, digital skills training, and upskilling. This is in response to India's current situation where only 48.7% of the country's youth are considered employable and many companies report a skill gap. The budget includes the launch of PMKVY 4.0, which is aimed at training many youths in emerging technologies such as AI, robotics, mechatronics, and IOT. This investment in technology and skill development is expected to bridge the talent gap, create job opportunities, and empower the current workforce to remain competitive, positioning India as an important digital talent hub for the world.”

As the education sector gets artificial intelligence added to its curriculum, Make In India and Make AI for India gets support from stronger technology to build Atmanirbhar Bharat with the highlights focusing on the string digital infrastructure and technology.

Entity DigiLocker

The Entity DigiLocker will get set up for use by MSMEs, large business and charitable trusts. The same will be towards storage and share of documents online securely, whenever needed, with various authorities, regulators, banks which include other business entities.

5G Services

100 labs for development of usage of 5G services will be installed up in engineering institutions for realization of a new variety of opportunities, business models, and employment potential. The labs get cover of others, applications such as smart classrooms, precision farming, intelligent transport systems, and health care applications.

Praises Of Optimism

"We congratulate Hon'ble Finance Minister on emphasizing technology-led growth for the third successive year. This transformation will lead to greater use of technology solutions, elevating India’s economic efficiency. The Data Governance policy draft is a welcome step; unlocking data for India’s growth will be crucial. With our expertise in the data domain, we are optimistic about staying ahead of market trends and customer needs in this segment. We have been an integral part of the lending ecosystem; simplifying the KYC process will further fuel the coverage. Our approach of accelerating telecom as one of our core sectors aligns with the government’s call to enhance 5G services further. Our credibility in data integration at scale provides us with a natural head-start in advancing our proposition for this fast-growing ecosystem,” says Peeyoosh Pandey, Chief Executive Officer, Hoonartek.

The praises by the Chief Executive Officer, Honnartek as stated helps in advancement of the proposition for the fast growth of the ecosystem and fuel for the coverage of Data Governance and in turn the government’s call to enhance 5G services.

Employable Opportunities

“The adoption of AI, ML and cloud computing is rapidly increasing across various sectors, which necessitates the adoption of cybersecurity not only after, but during the build process as well. The strengthening of skilling infrastructure announced in the budget is a timely response to this development. The Data Governance policy, which will enable access to anonymized data, is also a crucial initiative that provides hope in the face of the growing threat of cyber-attacks,” said, Vijendra Katiyar, Country Manager, India & SAARC, Trend Micro.

In addition of the technologies including AI, ML and Cloud Computing, the development of the sectors is also demanding better cybersecurity that can defend cyber-attacks and help in crucial initiatives. Helping in battling cyber-attacks, it is also helpful in providing equal opportunities to employment.

Green Hydrogen Mission

It has been a recent launch National Green Hydrogen Mission, with a foray of ‘19,700 crores, will facilitate transition of the economy to low carbon intensity, reduce dependence on fossil fuel imports, and make the country assume technology and market leadership in this sunrise sector. The target is reaching an annual production of 5 MMT by 2030.

Data Embassy

• In countries that looking for digital continuity solutions, there will be facilitation of setting up of their Data Embassies in GIFT IFSC.
• For enhancement of business activities in GIFT IFSC, the following measures will be taken:
• Delegating powers within the SEZ Act to IFSCA for avoiding dual regulation, Setting up a single window IT system for registration and approval from IFSCA, SEZ authorities, GSTN, RBI, SEBI and IRDAI.

Skill India Digital Platform

The digital ecosystem for skilling will further get expansion of launching of a unified Skill India Digital platform for enabling demand-based formal skilling, linking with employers including MSMEs, and facilitating access to entrepreneurship schemes.

Big Relief Under New Tax Regime

The finance minister will be providing the much-awaited relief to taxpayers by raising slabs:

• Rs 0-3 lakh will attract nil tax
• Above Rs 3 lakh and up to Rs 6 lakh to be taxed at 5%
• Above Rs 6 lakh and up to Rs 9 lakh to be taxed at 10%
• Above Rs 9 lakh and up to Rs 12 lakh to be taxed at 15%
• Above Rs 12 lakh and up to Rs 15 lakh to be taxed at 20%
• Above Rs 15 lakh to be taxed at Rs 30%

Fiscal Consolidation Continues, Borrowings Elevated

• Sitharaman inclined to fiscal consolidation path, pegging the FY24 figure at 5.9% of the GDP. The government is likely to meet the budget estimate of 6.4% in FY23.
• The government will be adhering to the fiscal deficit glide to below 4.5% by 2025-26.
• The government is estimated to borrow Rs 15.45 lakh crore via bonds in FY24, with net borrowings at Rs 11.8 lakh crore.

Product Costing

• Mobiles, camera lenses get cheaper
• Gold, silver, diamonds, cigarettes, imported rubber will become expensive 
• Luxury cars and EVs that are fully imported to cost more; custom duty raised by 1,000 bps to 70 percent
• Mobiles, camera lenses will get cheaper
• Gold, silver, diamonds, cigarettes, imported rubber will get more expensive 
• Concessional basic customs duty of 2.5 percent will be continuing to copper scrap

Others

• There will be three AI centres of excellence that will be set up
• KYC procedure will get simplified further; PAN to be recognized as a common business identifier
• Revamped MSME credit guarantee scheme with infusion of Rs 9,000 crore, to be generated on April 1

Savings

• People with monthly Income Scheme limit doubled to Rs 9 lakh, Rs 15 lakh for joint accounts
• Senior Citizen Savings Scheme limit increases to Rs 30 lakh
• One-time new small saving scheme Mahila Samman Savings Certificate will get available for two years up to 2025; scheme to allow maximum deposit of up to Rs 2 lakh, yield 7.5 percent interest

Taxes

• Tax exemption will be imposed on capital goods and lithium batteries
• There will be Higher TDS limit of Rs 3 crore for cooperatives
• There will be a Rebate limit that will be increased to Rs 7 lakh in new income tax regime; No. of slabs that are reduced are in seven to five
• There will be only five percent tax on individuals with annual income of Rs 9 lakh to only pay Rs 45,000 in tax
• People in salaried class and pensioner standard gets deduction increased to Rs 52,000
• The Highest tax rate 42.74 percent brought down

Conclusion

“The Budget has been a step in the right direction for strengthening GST compliance eco-system without levying additional burden on the taxpayers. There have been several taxpayer friendly steps such as allowing composition dealers to supply goods through e-comm operators, restricting filing of returns after a certain period to enforce compliance, decriminalizing certain offences and raising the monetary threshold for launching prosecution. The amendments to clarify the intend of the law in certain cases is also a welcome step. The consent-based GST returns, e-invoice and e-way bill data has been allowed by inserting Section 158A to allow flow-based lending. This will enable the new age fintech companies to use such data and analytics to disrupt the traditional forms of doing business, target niche markets and orient their products to maximize consumer satisfaction.” - Niraj Hutheesing, MD & Founder at Cygnet Infotech.

With the allowance of the budget an INR 1,000 crore for the modified scheme for setting up semiconductors all around India, and an INR of 4 lakh has been allocated for the scheme of setting up display fabrication units in India. According to renowned business personnel in a reputed business arena, Chief Financial Officer Rahul Tewari, concludes as, “The removal of the minimum threshold of Rs 10,000 for TDS deduction is a progressive step as the government is creating a new section for the online gaming industry.”

The investment of direct capitals by the Centre is complemented by the provision that made the creation of capital assets through Grants-in-Aid to States. The ‘Effective Capital Expenditure’ of the Centre is budgeted at INR 13.7 lakh crore, which will be 4.5 percent of GDP.

The government will continue the 50-year interest-free loan to state governments for one more year to spur investment in infrastructure and to incentivize them for complementary policy actions, with a significantly enhanced outlay of INR 1.3 lakh crore.

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