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Consumer, Retail and E-commerce market reaction on Budget 2022-23: As Finance Minister Nirmala Sitharaman on Tuesday made an announcement outlining the economic growth for India over the next 25 years.
Here’s what the Consumer, Retail and E-commerce market sector experts are saying about the Union Budget 2022:
Avneet Singh Marwah, CEO, SPPL:
The retail and consumer durables sector contribute a lot to India’s economy. Considering the fact that these sectors have been hit hard in the pandemic, we were surprised to see there were no relaxations or amendments provided to the manufacturers. I would rate this budget on an average.
Despite the overachieving GST collection from the past 4 months, the tax on smart TVs above 81 cm remains at 28%, which is the highest in any developing economy. We were expecting it to be reduced to 18% so that people could get TVs at a cheaper rate.
There was also a talk that television would be included in the PLA scheme, which was also missing. A few things that interest us in the budget is that the announcement of the launch of 5G this year will help consumers adopt better Smart TVs and content quality. The Government has spoken about adding 80 lakhs affordable homes, which will benefit the consumer electronics industry. Apart from that we were expecting big announcements on inflation, income tax, manufacturing sector etc which could have improved market sentiments.
Mandeep Arora , Managing Director, UBON:
The Union Budget has tweaked duty on electronics and phone parts in the Union Budget 2022. Revision of customs duties on components or sub-parts of consumer electronics items is a seemingly encouraging step to promote local manufacturing and increase local sourcing of components. This may lead to reduction in cost prices of Mobile phones and chargers.
Another noteworthy point was on how using smartphones to carry on transactions will bring in more transparency in the system.
Lalit Arora, Co-Founder, VingaJoy:
We welcome the UNION Budget 2022. Concessions in customs duty will be given to promote electronics manufacturing, wearables and hearables devices including concessions on parts of mobile phones including camera modules etc.
This will be an encouraging step for companies operating in consumer durables manufacturing. Since mobile phones constitute a major chunk of the country’s electronics exports, the step by the Government is a positive move. The initiative to boost startups and make the market value and position of existing players more promising is well received.
Ketan Patel, CEO, Mswipe:
Setting up of Digital Banking Units to mark 75 years of Independence is not just a symbolic honour but also recognition of the digital first banking approach that the government is keen to pursue to help the larger part of the population, which is new to digital or new to banking, find it easy to access financial services. By choosing to continue with the benefits that the digital payments ecosystem enjoys, the government has reaffirmed its commitment to digital payments and digital financial services as ‘the way forward’ for consumers. Bringing post offices under core banking system is a major step to ensuring inclusive and accessible financial services to the remotest of locations in the country.
Sujeet Kumar Mishra, Co-founder & CEO, Winni:
Despite the unanticipated third wave and partial lockdowns, the Indian economy has recorded its highest gross GST in January 2022, which is, of course, a great start to the year. It indicates that the economy has developed resilience and the capacity to sail through unexpected crises. Companies and brands are implementing new strategies to reintroduce and sustain growth, for which government support is critical. Certain sectors, which are no longer considered a luxury but rather a necessity for the masses, do require some tax relief. For instance, with annual revenue of approximately $7.60 billion in 2020, the bakery industry has enormous potential for growth and innovation, and imposing a high GST is not appropriate for such sectors. Strong demand for cakes from Tier II and Tier III markets is bolstering this industry, and 18% GST on it increases the cost by more than 10 %, making it a bit expensive for people.
Although it is encouraging to see that more innovative startups are contributing to the Indian economy, the pandemic that ravaged the country for three consecutive years took a toll on the new brands. While startup tax incentives have been increased from three to four years after incorporation, the conditions remain the same. It would have been beneficial if the tax rebate had been expanded from Rs. 25 crores to Rs. 50 crores turnover.”