Union Budget | Industry bodies in Karnataka hail it

The Federation of Karnataka Chambers of Commerce and Industry said the budget focused on bringing a balance between reforms and populism.

Bengaluru: The Bangalore Chamber of Industry and Commerce (BCIC) on Tuesday lauded the Union Budget 2024-25 as a comprehensive and forward-looking roadmap for India’s economic growth.

In a statement, the BCIC expressed its satisfaction with the government’s proactive stance on several key areas, including MSME development, job creation, ease of doing business, and tax reforms.

“Budget 2024 presents a comprehensive vision for India’s development, with a strong emphasis on employment, skilling, MSMEs, agriculture, and the middle class. The government’s commitment to nine key priority areas, coupled with the assurance of continuity, provides a robust framework for sustained growth," BCIC President S Devarajan said.

The substantial allocation of Rs 11.11 lakh crore for capital expenditure is a significant boost to the economy, with potential to drive growth in sectors such as cement and steel while generating ample employment opportunities. Initiatives aimed at incentivising fresh employment, promoting internships, and fostering affordable housing demonstrate a clear focus on social welfare, he said.

Additionally, the government’s efforts to create digital infrastructure in agriculture and support the tourism industry are commendable, Devarajan said. "Bengaluru, as a startup hub, benefits significantly from the abolition of Angel Tax and Equalization Levy. The rationalisation of capital gains tax is another positive step. It is encouraging to see that many of BCIC’s recommendations on MSMEs, startups, ease of doing business, tax reforms, and sustainability have been incorporated into the budget," he added.

The Federation of Karnataka Chambers of Commerce and Industry (FKCCI) also welcomed the union budget which, it said, is focused on bringing a balance between reforms and populism. The FKCCI said it sets a four pillar approach to foster speedy economic development – focusing on Employment, Skilling, MSME and the Middle Class. It appreciated the significant push towards improving the financial health and borrowing ability of MSMEs. The Government has evidently focused on ELI (Employee Linked Incentive) Scheme along with PLI.

"FKCCI welcomes the efforts towards boosting employment opportunities by giving wage benefits for first time workers through EPFO, additional thrust to skilling, industrial training on hub and spoke model, and additional support for loans up to Rs 10 lakh for Higher Education. This helps in achieving the 'Viksit Bharat' goal in a faster manner," it said. "We are happy to note that Mudra loans limit extension to Rs 20 lakh would help small proprietary businesses and partnership firms. This helps micro entities further," FKCCI President Ramesh Chandra Lahoti said.

Karnataka Small Scale Industries Association (KASSIA) President, M G Rajagopal too hailed the Union Budget 2024-25 as a pronounced policy vision statement that will encourage and empower the MSMEs visibly. Rajagopal said the credit guarantee scheme with a substantial cover of up to Rs 100 crore for MSMEs in the manufacturing sector is a much-needed step towards facilitating easier access to finance, promoting investments in machinery, and enhancing productivity. In a statement, he said the introduction of three employment-linked incentive schemes aimed at promoting formal sector employment, especially in manufacturing, is a forward-thinking initiative that aligns with industry needs. Enhancement of MUDRA loans from Rs 10 lakh to Rs 20 lakh for previous borrowers who have successfully repaid their previous loans will provide critical financial relief and enable small entrepreneurs to expand their operations, he said. According to him, the announcement of "plug and play" industrial parks in 100 cities will attract investments and bolster industrial infrastructure. The commitment to upgrade 1,000 Industrial Training Institutes in hub and spoke arrangements over the next five years underscores the government's focus on enhancing skill development and aligning training with industry needs, Rajagopal said.

The revision of the Model Skill Loan Scheme to facilitate loans up to Rs 7.5 lakh with government guarantees is expected to significantly enhance employability and skill acquisition among the youth, thereby supporting industry growth, he said. "The cut in sector-specific Customs Duty will bolster local production capabilities and strengthen India's strategic sectors such as renewable energy, telecommunications, and electronics. The establishment of e-commerce Export Hubs under PPP mode will integrate MSMEs and traditional artisans into global supply chains, thereby boosting exports and fostering economic growth," he added.

Rajagopal said the proposal to open 24 branches of SIDBI will also help to extend credit for MSMEs, which is a big relief for the small scale industries. On the flip side, however, the budget could have considered KASSIA's plea for a lower loan interest rate regime for MSMEs and cut in processing fee on loan renewals, according to him. "Also we would have been happy if the NPA norms were extended to 180 days and Annual renewal charges for OD/CC limit waived to MSMEs," the KASSIA President said.

Union Budget 2024 LIVE | Making a record for any Finance Minister, Nirmala Sitharaman presented her 7th consecutive Union Budget on July 23, 2024 under the Modi 3.0 government. This Budget brought tax relief for the middle class, while focusing on jobs through skilling, incentivising employers. Track the latest coverage, live news, in-depth opinions, and analysis only on Deccan Herald. Also follow us on WhatsApp, LinkedIn, X, Facebook, YouTube, and Instagram.