Nirmala Sitharaman who is India’s finance minister is set to present the Union budget for the financial year 2022-23 on February 1. the Micro, small and medium-sized enterprises (MSMEs) sector is positive about the same.
Some of the Union’s expectations Budget 2022 simplify taxation, investment and provide new incentives for Indian start-ups and MSMEs.
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“MSMEs are looking for measures to improve credit and accessibility of funds that can mobilize growth. We expect the Union budget will focus on simplifying taxation, investment and providing new incentives for Indian start-ups and MSMEs, which can help generate more revenue and jobs,” said Vibhor Sahare, CEO and Co-Founder of ANS Commerce.
Lokendra Ranawat, CEO of Wooden Street, shares what MSMEs are anticipating and expecting from the Modi government in the 2022 budget:-
- Optimism for the banking sector“NBFC has a vital role to play in complementing the banking sector. People are optimistic that this year’s budget will provide the much-needed boost to the economy given the slowdown and deterioration from last year’s crisis,” says Lokendra Ranawat.
- Increased allocation in the health sector: “Yes, it is genuine, and people have high expectations for this sector in 2022. This includes the allocation in the health sector on the whole infrastructure, where the focus must be on a reliable medical cold chain for the success of everything PNV (National Vaccination Program). This will ensure that the country is prepared in advance to fight the pandemic and any other future crises,” he added.
- Full Funding of “AtmaNirbharSwasth Bharat Yojana”: “As we all know, last year, the Minister of Finance launched – “AtmanirbharSwasth Bharat Yojana”, with an expenditure of around Rs 64,180 crore over 6 years, with the promise that “As institutions absorb more, we will engage more”. And, now comes the time when we eagerly await the announcement of full funding to achieve the goals set out in the 2020 National Infrastructure Pipeline,” he added.
- GST Rationalization: Ranawat said, “As we can see, the prices of the raw material are very high and it is neither uniform nor controlled. In this case, the the government should at least streamline GST on manufacturing for MSMEs. Experts in this area have suggested that the GST for manufacturing should be reduced to at least 12% instead of 18%.
- Recapitalization of the public sector: He further stated that they even hoped for an incomplete credit demand recovery across the country. “There should be a push towards affordable and rental housing and the strengthening of existing financing systems to provide liquidity to stalled real estate projects,” he concluded.
In the union budget 2021-22, i.e. last year, several measures were taken to encourage the MSME sector, and the government had given ₹15,700 crore to this sector. The budget had proposed some changes for the benefit of MSMEs, which were to increase duties on steel screws, plastic construction articles and shrimp feed.
On December 30, 2021, the Minister of Finance had organized a pre-budget meeting with all the Ministers of Finance of the States. This was certainly part of a series of consultations that took place in the run-up to the Union budget 2022-23.