Budget 2024: Companies Expect Skill Development, Infrastructure Boom & Push To PLI Scheme Companies anticipate that the Budget is likely to introduce incentives for domestic manufacturers, potentially including tax benefits, subsidies, to boost the 'Make in India' initiative and private sector participation
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The Interim Budget 2024 increased capex for 2024-25 by 11 per cent to INR 11.11 lakh crore, which, though lower than the hike expected by industry leaders, was still significant. With the Union Budget around the corner, companies eagerly anticipate the Budget to further propel India's development initiatives with robust allocations and policy measures to bolster projects across the country.
"We welcome the government of India's commitment to fostering growth, sustainability, and inclusivity. The significant increase in infrastructure outlay to INR 11.11 lakh crores and the emphasis on green growth demonstrate the government's pursuit of economic excellence. Sustainable and resilient development should be at the forefront of the budget's agenda. Furthermore, we expect the budget to address the pressing need for skilled manpower in the sector. Dedicated provisions for skill development and training programs will be instrumental in bridging the talent gap and ensuring the successful execution of ambitious projects," said Arun Shukla, president and director, JK Lakshmi Cement.
This year's Interim Budget unveiled a transformative vision emphasizing strategic initiatives such as the Port Connectivity Corridor, Energy, Mineral, and Cement Corridor, and the High Traffic Density Corridor. These corridors signify a pivotal step towards enhancing connectivity, driving economic growth, and ensuring passenger safety. "With a focus on outcomes over outlays, the government underscores its commitment to timely delivery and cost-effective logistics solutions. Also, these are core infrastructures and every penny invested in core infrastructure has a rebound effect on the economy," said Vivek Lohia, MD, Jupiter Wagons Limited.
Sharing a similar opinion, Schwing Stetter India's chairman V. G. Sakthikumar, said, "Our expectation is more fund allotment in the infrastructure industry. We are anticipating more railway job creation and fund allotment to different industries."
For the market to thrive, Production Linked Incentive (PLI) schemes should be expanded. To boost India's viability as the next manufacturing hub, especially with the China+1 strategy to bolster investment in the country, the government should consider extending the concessional tax regime. This will help boost investor confidence and will also supplement the PLI schemes being run by the government, according to a consumer industry analysis by Deloitte.
The PLI scheme initiative is poised to create an entrepreneur-friendly eco-system in India. The benefits, as the government envisages, are import substitution, export-led growth and foreign investments which will provide a supportive environment for MSMEs enabling them to play a fundamental role in the industry's ecosystem. According to a PIB release in January this year, PLI Schemes witnessed over INR 1.03 lakh crore of investment till November 2023, which has led to production/ sales of INR 8.61 lakh crore and employment generation (direct & indirect) of over 6.78 lakhs. PLI Schemes have witnessed exports surpassing INR 3.20 lakh crore, with significant contributions from sectors such as large-scale electronics manufacturing, pharmaceuticals, food processing, and telecom & networking products. As many as 176 MSMEs are among the PLI beneficiaries in sectors such as bulk drugs, medical devices, pharma, telecom, white goods, food processing, textiles & drones. Several MSMEs are serving as investment partners/ contract manufacturers for large corporations.
"At Jupiter Wagons, we are actively capitalizing on the PLI scheme's opportunities. Our strategic acquisition of Bonatrans for domestic wheelset manufacturing exemplifies our commitment to reducing import dependency and bolstering local production. With sustained and targeted support from the government, we anticipate significant advancements in the rail components sector, driving India towards a self-reliant and globally competitive manufacturing landscape," Lohia added.
The budget is likely to introduce incentives for domestic manufacturers, potentially including tax benefits or subsidies, to boost the 'Make in India' initiative and private sector participation.
