Government Finances for 2020: Developing Businesses Update - Initial Capital Injecting and Tax Reductions
In the Union Budget 2020, the government announced plans for the development of five new smart cities in India, aiming to contribute to the growth and modernization of Indian cities. However, the budget does not provide specific details about these cities or their direct impact on various sectors.
One sector that seems to have gained support is the startup ecosystem. Indian entrepreneurs have appreciated the budget's focus on startups, with the availability of coaching, courses, financial aid, and various funding opportunities making it easier to start a business. This is particularly significant for women entrepreneurs, who remain underrepresented in the startup scene.
The budget also includes measures to help small players in the export sector. The Finance Minister's announcements will facilitate export finance through the introduction of the Nirvik scheme and simplified processes for faster claim settlements. Mr. Tim Nicolle, Founder of PrimaDollar, believes these measures will boost exports.
In the digital realm, Mr. Harsh Jain, Co-founder and COO of Groww, welcomes the policy for data center parks, which will provide resources for digital initiatives like fintech, AI, and aggregator platforms.
The budget also addresses the MSME sector, with a focus on enabling growth through the extension of GEM e-marketplace as a unified procurement channel. Ms. Meghna Suryakumar, Founder and CEO of Crediwatch, appreciates this move, as it will benefit MSMEs.
However, there are areas where the budget could provide more clarity. For instance, Mr. Archit Gupta, Founder and CEO of Cleartax, finds the deferment of ESOP taxation at the time of exercise to be a welcome move, but suggests the government needs to relax more the conditions and approvals built into section 80IAC for startups.
In conclusion, while the Union Budget 2020 does not mention a direct impact of the development of the five new smart cities in India on various sectors, it does provide support and incentives for startups, the export sector, and the MSME sector, among others. The impact of these measures on the overall development of Indian cities and the economy remains to be seen.
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