Union Budget 2018-19 - Reactions

Union Budget 2018-19 - Reactions

The Union Budget presented today is a balanced Budget with a focus on the Agri Sector, Rural Development, Healthcare and a continued thrust on Infrastructure creation. All of these will provide significant impetus to the revival of growth and creation of employment. The Budget also addresses the opportunities to modernise and create new infrastructure in Affordable Housing, Railways, Airports which continues the effort of the last few years. These will present favourable opportunities for growth to the Indian Construction Equipment Industry. Incentivisation to the MSME sector, which forms the backbone of industrialisation of a Nation, as also job creation is another welcome step - Vipin Sondhi, MD & CEO, JCB India Ltd

The Union Budget 2018-19 is certainly a positive move that aims to increase convenience for the common man. Given the rising urban population, safe and effective traffic solutions are imperative in managing crowds.” - Sebi Joseph, President, Otis India

Union Budget 2018 has struck a fine balance between fiscal prudence and providing growth boosters to the economy. It is a progressive budget and in line with the development priorities of the Government. The Finance Minister has made a strong attempt to pump prime the rural economy, agriculture and infrastructure sector. The Government continues to boost the infrastructure sector, which is the backbone of the country’s overall development, with a proposed Rs. 5.97 lakh crore additional budgetary allocation for infrastructure. Ambitious Bharatmala Pariyojana has been approved for providing seamless connectivity of interior and backward areas and borders of the country to develop about 35000 kms in Phase-I at an estimated cost of Rs5,35,000 crore. To raise equity from the market for its mature road assets, NHAI will consider organizing its road assets into Special Purpose Vehicles and use innovative monetizing structures like Toll, Operate and Transfer (TOT) and Infrastructure Investment Funds (InvITs) - Jayant Mhaiskar, Vice Chairman & Managing Director, MEP Infrastructure Developers

We welcome the Union Budget’s strong focus on inclusive development, with allocations for enhancing both rural and urban infrastructure. It gives a big boost to rural infrastructure by ensuring electricity access to all rural households under the Saubhagya scheme. Additionally, the allocation of Rs. 2.04 lakh crores for developing smart cities will go a long way in creating world class urban infrastructure” - Sumit Joshi, Vice Chairman and Managing Director, Philips Lighting India

The budget reaffirms continued focus on Infrastructure and programmes such as Smart City mission, AMRUT, NMCG, the Regional Connectivity Scheme (UDAAN) etc. as can be seen by increased outlay by 20% from the previous year. The key takeaway form this budget is the thrust on social and rural infrastructure including health, education, housing, agri-value chain and penetration of digital infrastructure. Another key point is the emphasis on job creation particularly in the rural area through investment in the infrastructure. Overall, given the constraints and recent reforms initiatives, it is a balanced budget; however,  the true picture will emerge only after implementation framework are detailed - P Pranavant, Partner, Deloitte India

Finance Minister Arun Jaitley’s move to set up 2 defence production corridors is the right step to boost the `Make in India’ initiative aimed at self-sufficiency in ammunition procurement. It also compliments initiatives taken in the past to nurture domestic defence production capability that will make India self-reliant in meeting our defence needs. Allocating  INR 5.97 lakh crores to improve India’s infrastructure is a firm step towards bringing it at par to Asian levels. We see rising demand for industrial explosives due to encouraging measures such as the target to complete construction of 9,000 km of national highways this year by the NHAI. Spent on rural roads out of total allocation for Rural development is also enhanced in big way and these will boost demand industries explosives  - Manish Nuwal, MD & CEO at Solar Industries India Ltd. (SIIL)

The announcement of the proposed Union Budget 2018 with an agenda to develop, educate and sanitize rural India is reasonably balanced for an inclusive growth of the Indian economy. The government has taken note of the signs of distress in the rural economy and the budget has provided some decent measures to address some pressing concerns. Initiatives announced in the budget bought many cheers to infrastructure, healthcare, education and agriculture sectors. As Budget 2018 has identified infrastructure as one of the key drivers of the economy, lot of initiatives has been announced for the betterment of the sector. The government has taken the onus of constructing 35,000 kms of roads under the Bharatmala Pariyojana project for which the Budget allocated is Rs 5.35 lakh crore which aims to provide seamless connectivity in backward and border areas. The allocation of Rs 11,000 crore for Mumbai rail network will definitely create a positive impact on the infrastructure sector. The announcement of constructing 9,000 km national highways will create job opportunities. Budget is also strengthening the railway network and enhancing railways’ carrying capacity. The Capex for Railways pegged at Rs 1,48,528 crore for FY2018-19, will not only boost the transport system but also create a huge opportunity for ancillary industries. UDAAN initiative is also set to escalate the airways sector and provide lot of opportunities for companies in the infrastructure space. Urbanization being on the priority, various affordable housing schemes and government’s investment of 2.04 lakh crore for building 100 Smart Cities with state-of-the-art amenities will further enhance the development in infrastructure sector. Overall this is a growth budget with high emphasis on infrastructure, health, education and agriculture sector -  Sorab Agarwal, Executive Director, Action Construction Equipment Ltd

While the budget strongly favours the agricultural sector, there are also a few elements that focus on the infrastructural sector and the Smart Cities. This boost to infrastructure and Smart Cities is much needed. But what we would now like to also see is a clear roadmap on implementing this. Another key aspect that I am happy to see in this budget is the support for the Amrut program, which will focus on supplying water to all households in 500 cities. If implemented effectively, this will create a huge social impact and help uplift the water accessibility of these communities. The allocation for education and training of 13 lakh teachers, if done well, will have a significant impact on the young in India  - Ranganath NK, Managing Director - Grundfos Pumps

The emphasis on Infrastructure spending augurs well for companies catering to this sector & Strengthening of Railways through Capex of 1,48,558 crores will benefit CMI which counts Indian Railways as its largest customer - Amit Jain, MD, CMI Ltd

The Union Budget 2018 has been focused on initiatives to drive the economic growth and social welfare. The budget clearly emphasizes Government’s interest towards the development of rural India and bringing Infrastructural development in the country. The allocation of Rs 14.34 lakh crore fund towards rural housing, rural roads and rural infrastructure will help in creating employment opportunities.  Affordable Housing is a key growth driver for the real estate industry, as it now enjoys higher affordability given the government support through interest subsidies. In-line with PMs vision of “Housing for All” by 2022, the move of setting up a dedicated fund for Affordable Housing under the National Housing Bank is welcomed. The move will help in improving formal finance penetration in the system, enabling strong growth in affordable housing loans. We will also have a new brand for aspirational homes in a completely new division created for this segment. Under this division, we have acquired 100-acre land parcel under the asset light joint development agreement (JDA) model and has a potential of generating revenues of over Rs 5,500 crores - Kamal Khetan, Chairman and Managing Director, Sunteck Realty

We welcome increase in custom duty of refractory products as this will reduce dumping from China and boost local manufacturing. Increase in domestic capacity utilisation will spur new investments in this sector which is critical to support the government’s vision of enhancing steel capacity in India to 300 mil mt. The fillip to infrastructure development through expansion in railways, roads and ports also augurs well for refractory industry as it will increase steel and cement consumption. Dalmia Bharat Group has four plants and one R&D centre dedicated to refractories in India and employs approximately 3,000 people in the segment -  Sameer Nagpal, CEO, Refractories, Dalmia Bharat Group

It is a forward looking budget and an affirmation on housing for all by 2022. Infrastructure being the key pillars of the budget is something to look forward to in the long run. With extension of 3.17 lakh kilometers of rural roads, 51 lakh new rural houses and 2 crore toilets to be built by 2019, will raise the demand of cement, this will be augmenting the infrastructure segment, leading to employment generation and development of our economy - Mahendra Singhi, Group CEO, Dalmia Cement Bharat Limited

The focus of the Union Budget 2018-2019 has been to boost investments in rural development, education, healthcare and social sectors. With sizeable allocations to the rail and road sectors; it clearly recognizes the infrastructure sector as a growth driver. Revisions in MSP, emphasis on rural MSME credit, and similar initiatives should lead to a significant improvement in rural incomes. A push in rural development, road and rail sectors, affordable housing and smart cities will all help the cement industry; as an increase in rural spending power should translate into more housing. With an increased GDP, which facilitates connecting and integrating the country with a network of roads, airports, railways, ports, and inland waterways; the infrastructure sector should see a growth in demand. The focus on roads and rails will also positively impact consumption of cement and concrete. A growth of 7-8% by the third quarter of the next fiscal is something that the cement industry would eagerly await." -  Ujjwal Batria, Managing Director & Country CEO, Nuvoco Vistas Corp. Ltd (formerly Lafarge India)

The budget is on the expected lines since this is the last budget of the current tenure of Narendra Modi-led government. As Finance Minister mentioned this budget is pro people and pro farmers. The thrust on agriculture and health related schemes and provisions will have a trickledown effect on various other sectors too. Operation Greens which has been allocated a sum of Rs. 500 crore is a good start. However, use of cold chains and solar powered dryers could have been incentivized. Nonetheless, the emphasis on building a research driven economy through Prime Minister’s Research Fellows (PMRF) Scheme is commendable, and is a right step in the direction of building an innovation driven economy. Policies such as imposing customs duty on electronics and electrical products will boost indigenous manufacturing and fuel more employment opportunities - Ajay Durrani, Managing Director, Covestro India

While the budget has laid out a clear roadmap for expansion and modernization of Indian Railways, it has also adequately emphasized on the much-needed need for passenger safety. Along with CCTVs, installation of advanced, multi-level fire detection system can go a long way in improving safety standards of Indian Railways. Early warning of a fire event can prevent panic and loss of life and damage to assets, thereby minimising disruption of services. At the same time, the budget has a clear focus on creation of infrastructure and development of smart cities. With a plan of 100 smart cities rolled out by the government, there is a need to provide greater emphasis on developing a fire safety blueprint to ensure safety of life and property, along with increased awareness and training at all levels about fire, its hazards and what to do in case of fire - Rohit Harjani, Country Manager Indian Sub-continent, Hochiki

Budget 2018 has been a mixed bag for real estate sector, the announcements made by the Government are very optimistic for affordable housing and will definitely attract more corporate players to enter this space. We welcome the Finance Minister’s decision of allocating budget for infrastructure spending on roads and construction that will definitely improve connectivity and boost housing demand, thus creating opportunities for new homes and development. However, the real estate industry was looking forward to the long-pending demand of receiving infrastructure status and single window clearance for all real estate projects that will avoid project delays and increase transparency in the sector. Also, from home buyers perspective, additional relief on stamp duty and registration could have been reduced or merged with GST as that would ease the financial burden and expedite the decision of home buying - Rajeev Piramal, Vice Chairman & Managing Director, Peninsula Land Ltd

We welcome the Union Budget 2018 announced by honourable Finance Minister which has recognised infrastructure as a growth driver of the economy. The investments in infrastructure are estimated to be in excess of Rs 50 lakh crore. This will support the growth of GDP and connect and integrate the nation with a network of roads, airports, railways, ports and inland waterways.  To facilitate trade and e-commerce, the government should consider Aviation Turbine Fuel (ATF) under the ambit of GST as the excise / VAT paid on these products are not available as input credit. Under the Service Tax regime, input credit was available for the excise paid on ATF. Under GST, this has a negative impact on logistics costs - Aneel Gambhir, CFO, Blue Dart

The budget focuses on uplifting living in rural India. Except the vocational level  job oriented sectors textile, leather etc., it does not address any specific Industrial sector. As far as Infrastructure sector is concerned the Budget mentions some of the schemes which can be considered as opportunities like Smart Cities, Ganga cleaning, potable water distribution and railways the budget remains silent on addressing the issues being faced by Infrastructure industry in India which is reeling under pending litigations, absence and in fact waning banking support, inefficient and opaque procedures. The government needs to take up policy initiatives in order to achieve efficient, transparent and healthy EPC industry not only for realization of its development programs proposed in the Budget but also  keeping in view the large size Infrastructure projects needs to address these issues particular EPC companies undertaking project exports are facing enormous procedural and outdated issues - Pankaj Goyal (Whole Time Director & CFO)

The much awaited union budget presented by Finance Minister, Arun Jaitley shows immense promise for the country. The huge push given to infrastructure in the Union budget by the government is a good move. Construction of 35,000 km of highways under the Bharatmala project with highway construction to exceed 9000 km by end FY18 and the government has also allocated Rs 2.04 lakh crore for the Smart City Mission with 99 cities selected for development in FY19. These policy moves are set to increase employment opportunities and create demand for commercial vehicles & construction equipment. Additionally, the extension of 25% corporate tax benefit to organizations with turnover up to 250 Cr is also a welcome move. All in all, we at ZF are looking forward to this financial year as this budget gives us the motivation to continue on our path of futuristic and sustainable growth - Suresh KV, Country Head, ZF India  

The budget reaffirms the strategic direction of clean governance, inclusive growth and bold moves on infrastructure and disinvestment. Very comprehensive and wholistic! - Puneet Dalmia, Managing Director, Dalmia Bharat Limited

Budget 2018-19 has an overall balanced view with focus on the masses. After last year’s GST rollout, we expected this budget to focus more on direct taxes. There weren’t too many announcements for the logistics sector, but the emphasis on infrastructure expenditure is a welcome move. Development of 35,000 km of road network under phase 1 of the Bharatmala project is a key corollary to addressing vital connectivity issues. The concerns of the logistics have also been looked into with the setting up of a National Logistics Information Portal. A much-needed single window clearance digital platform for stake-holders across the supply chain spectrum will enable them to consolidate their market competencies. Significant focus on healthcare, education, rural upliftment and digital India is laudable. Marginal slippage in fiscal deficit is a slight worry but overall it is a people friendly budget. However, we will have to deep dive for better understanding - Adarsh Hegde, Joint Managing Director, Allcargo Logistics Ltd

This was a balanced budget with focus on rural development, housing, health and infrastructure in line with the Government’s long-term economic vision. While the budget gave relief to MSMEs with turnover up to INR 250 crore, it failed to address the Corporate tax rate issue for larger corporates. The budget reiterated the focus on rural development which we believe will provide an opportunity for the electrical industry to work with the government. Also, the government’s proposed plan to create a dedicated affordable housing fund in line with its plan of providing housing for all by 2022 is good news for the allied segments. Another welcome move is the announcement of identification of 372-point plan on ease of doing business which will attract investments and improve the overall business climate - Rakesh Khanna, CEO, Orient Electric

The government has shown its keenness to develop the Indian international finance centres and make them competitive with the other global financial centres. The unification of laws and benefits to non-residents around transfer of certain securities including derivatives and reduction of AMT on the lines of prevalent MAT rates, may give the relevant impetus towards the growth and development of this regime - Vivek Mimani – Associate Partner, Khaitan & Co

The Finance Minister has announced in the budget that the Government of India will take necessary measures and encourage State Governments to put in place a mechanism that the surplus solar power generated by farmers is purchased by the distribution companies or licencees at reasonably remunerative rates. The move is a welcome step in trying to encourage self-reliance and productivity of rural households and at the same time providing impetus to solar rooftop targets and achieve the renewable energy targets. It will be important to see how this scheme is operationalised by the Government - Dibyanshu – Partner, Khaitan & Co

The Government has given importance to roads and railways in the budget and has made an all-time high allocation to rail and road sectors. The major portion has been rightly allocated to capacity creation, modernisation and safety. One of the key emphasis has been the redevelopment of 600 major railway stations being taken up Indian Railway Station Development Co. Ltd. It will be important to encourage private sector participation in station redevelopment projects and fast track such projects to achieve the desired fiscal results. A balanced commercial framework should provide the required impetus as the Government has already included in the harmonised list of infrastructure railways infrastructure to include development of commercial land around railway stations - Dibyanshu – Partner, Khaitan & Co

Reducing corporate tax rate to 25% for companies with turnover below Rs 250 crores will be very positive for the real estate industry. The trickledown effect of the tax saving will mean disposable income in the hands of the common man, thereby increasing consumption and investment in real estate. Disappointed that stamp duty was not incorporated in GST to ease pressure on homebuyers - Farshid Cooper, Managing Director, Spenta Corporation

This year's Union Budget was focused largely towards the fulfillment of government’s dream of ‘Housing for All 2022’ and allocation of fund for affordable housing was a boost yet lacks clarity.However, we were expecting a revision in GST rates so as to pass on the additional benefit to the home buyers, which was missing in this budget - Sarojini Ahuja, VP Sales & Marketing, Transcon Developers

Understanding the government major focus on affordable housing to achieve the target of housing for all, the budget was largely inclined towards the same. Rural infrastructure push will surely boost added housing in these areas resulting in employment generation. Further, the introduction of a long-term capital gain tax of 10% on shares is a step towards creating a bit of level playing field these two assets classes, ie, Real Estate and Stock market. This move is positive for Real Estate - Manoj Paliwal, Chief Marketing Officer, Omkar Realtors and Developers Pvt Ltd

We are delighted that this is an inclusive budget where the government has continued its thrust on infrastructure and targeting the rural economy with a commitment to affordable housing. Having said this looks like a ‘smart budget’ targeting the 2019 General Elections - Rohit Poddar, MD, Poddar Housing & Development Ltd

Driven with the target to provide housing for all by 2022, we appreciate the government’s move to build 1 crore houses under Pradhan Mantri Awas Yojna in the rural areas. This move will create housing demand and generate employment. This budget saw the government offering several benefits to the infrastructure sector, at the same time missed out on a few important aspects of the realty sector. Infrastructure status to the entire real sector is still not implemented this could have reduced the developers cost of borrowing for projects. Also the real estate sector looked forward to Single window clearance mechanism which could have helped the developers in making the process more seamless and quicker -  Amit Ruparel, Managing Director, Ruparel Realty

So eventually the 'election year' has taken the shine away from the 'Sun'. It is disappointing to see that the solar energy sector has been ignored in this year's budget. It was much awaited that the Finance Minister would clear the government's view on customs duty on solar cells and modules, but that has not materialized. Overall, with its overriding focus on farmers, the budget is expected to give a boost to rural consumption which in turn will help India achieve its much higher GDP forecasts for the next year - Gagan Vermani, Founder & CEO, MYSUN

The Union budget 2018 was a pragmatic one and focused on fortifying the economy as a whole. The Government’s endeavor to provide housing to every poor citizen by 2020 through the establishment of a dedicated affordable housing fund in the national housing bank, along with priority sector status being granted, is a commendable one. The government assuming ownership of NHB from RBI is also positive as it would translate into the focus of NHB shifting from regulation to development.  The reduction of the GST rate from 12% to 8% on affordable and low-cost housing units last week was a welcome reform.  Building 31 lakh homes in 2018-19 in urban areas and a further 51 lakh in rural areas will go a long way in addressing primary housing demand.
Overall, the strong economic impetus provided in the budget will ultimately boost housing and real estate. The introduction of long term capital gains tax at 10 per cent on equities will also have an indirect impact on making investment in real estate (over listed stocks) more attractive than before. Tax breaks being granted to senior citizens and salaried employees will increase their disposable income available for making capital purchases. A push on infrastructure comprising public investment in the rural areas, agricultural marketing, urban connectivity, particularly Metros etc will also multiply investment prospects for real estate sector - Khushru Jijina, Managing Director, Piramal Finance & Piramal Housing Finance

The Finance Minister, Arun Jaitley has presented a well-balanced and positive budget. We welcome the proposal of the National Logistics Portal as it will improve the transparency and visibility of cargo movement across the country. Infrastructure is the growth driver of our economy.  With a large number of players serving metro cities and cut-throat competition on price, many logistics companies are looking to build out their last mile capabilities in Tier 2 and below cities. These regions are still relatively underserved by logistics companies and have a booming middle class which is driving massive demand. With Digital India and bringing millions of Indians online, the rise of digital payments, dedicated marketing efforts of large e-commerce players, there is a big and growing e-commerce demand from regions beyond metros. On the multi-modal side, Bharatmala project is a positive development, coupled with eWay bill implementation which will result in faster turnaround times for on-road transportation. With the announcement of 1.48 Lakh crore allocated to Railways, we hope that there is a thrust on improving freight logistics apart from better passenger connectivity. This will help the logistics industry drive up efficiency through rail networks in terms of costs and CO2 reductions as the current logistics movement is skewed towards road transport. The Government’s plan to expand its current 124 airports by five times seems skewed in favour of passenger movement, however, the development of airports across the board is a positive shift in building a robust logistics network. We expect that freight movement is given due cognizance as well. The mass formalization of MSME sector will spur local manufacturing which will increase the need for logistics services across the board. It will boost the overall logistics sector, resulting in robust economic development. Since this is the last budget before the government goes on to elections, these announcements are welcoming, as they focus on strengthening Indian economy Raaja Kanwar, Managing Director, Apollo LogiSolutions Limited

Union budget 2018-2019 is offering a major boost to the ever emerging real estate industry. Government's initiative of allocating dedicated funds for the affordable housing scheme under NHB and One Crore houses under Pradhan Mantri Awas Yojana (PMAY)  will prove to be a win-win situation for the supplier and the buyer alike. The real estate industry also welcomed  the announcement of The Smart Cities Mission with government's initiative to spend about INR 2,04 lakh crores to execute smart projects will be an added advantage for the Indian Property segment. The capital gains on immovable properties has brought about a positive atmosphere in the Indian Property segment - Sanjay Bhutani - CMO, Rivali Park, CCI Projects

Budget 2018-19 focuses on infrastructure and the Smart Cities initiative is a positive move for the real estate sector and Pune in specific. The Smart Cities Mission is an ambition to develop 100 cities across India that would also harness the Information Communication Technology (ICT) capabilities. Pune comes under the governments Smart City initiative and the allocation of Rs. 2.04 lakh crore towards the listed 99 Smart Cities will serve well for Pune’s real estate market. Pune’s real estate is the lesser impacted markets in comparison to the other key cities and have proved to be one of the more resilient markets in the country. Unlike other metros where buyers have demonstrated a strong preference for ready-to-move in apartments, in Pune there has been a steady skew to in terms of interest in under-construction projects. It is important to note that strong Real Estate have had a steady momentum in terms of inventory off-take and that the excellent infrastructural connectivity has definitely lent a positive slant to sustaining the current momentum especially in some of Pune’s micro-geographies which have withstood the onslaught of a decline in prices due to the impact of de-monetization, RERA and GST. Combining Pune’s growing infrastructure along with the sustained demand will boost Pune’s real estate market further. Infrastructure is a growth driver for the country and the budgets focus on infrastructure and connectivity will have an impact on not only the real estate sector but the economy on the whole - Tushad Dubash, Director, Duville Estates

With a thrust on smart cities and identification of 99 cities under the ambitious Smart city mission will give a major boost to the clean energy sector as Smart Cities have a large component of Renewable Energy. Smart Cities Mission aims at building 100 smart cities with state-of- the-art amenities that incorporates renewable and natural resources with great emphasis. It is a clear indication that the focus on ‘green energy’ is one of the top priorities of the government. It will also boost the solar rooftop industry. These cities will be enabled by various projects like Smart Command and Control Centre, Smart Roads, Solar Rooftops, Intelligent Transport Systems, Smart Parks. Projects worth INR 2350 crore have been completed and works of INR 20,852 crore are under progress. We expect this will create a platform for the Supervisory control and data acquisition (SCADA) industry as well. With the aim – ‘Power for All,’ the government is determined to not leave any stone unturned in its target of meeting 100% electrification by 2018 as in the budget, it has been announced that there will be an increase of 35% of expenditure allocation to rural electrification schemes. We are happy that government has highlighted the benefits and advantages of solar-generated power and has acknowledged its practicality. The budget has announced the second phase of solar development of another 20,000 MW that will surely prove to be a major push for India to be one of the leaders in the global solar industry. Besides their commercial and individual uses, solar power has also been beneficial to Indian Railways as well as the peripheral railway infrastructure will be solarised. In the rural areas too, farmers are switching to use of solar power for pumping and irrigation purposes. In the Budget, Government has also taken appropriate measures to encourage the initiative and has announced that the State Governments will formulate a mechanism where the distribution companies or licensees will purchase the farmers’ surplus solar power at reasonable remunerative rate. Even though there has been a 6 per cent excise duty on solar tempered glass has been proposed, the basic customs duty on solar tempered glass for use in the manufacture of solar cells, panels and modules has been proposed to be eliminated. - Anmol Singh Jaggi, Director, Gensol Group

The budget has introduced some interesting schemes towards agriculture and rural development. They continue to support investments in infrastructure, which will support our portable compressor range.  Many of our suppliers will benefit from the MSME tax reduction and perhaps the tax reduction will encourage capital expenditure, which could in turn support our industrial compressor range. Overall, while there are no explicit manufacturing boosters, we hope that the momentum from the last quarter will sustain through 2018 - Dr. Jairam Varadaraj, MD, ELGi Equipments

@EPC World Media

 


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