Budget 2024: What startups and their investors want from Finance Minister Nirmala Sitharaman

Nirmala Sitharaman will present the budget on February 1, and this will be the last budget of the Modi 2.0 government.

Entrepreneurs and investors from various industries have certain expectations. Image: Freepik

We are only three days away from the presentational of Union Budget 2024, and everyone has some expectations from Finance Minister Nirmala Sitharaman. Similarly, entrepreneurs and investors from various industries have certain expectations. Sitharaman will present the budget on February 1, and this will be the last budget of the Modi 2.0 government.

Here's what industry experts are saying from the edtech, fintech, and ecommerce startups. Take a look:

Milan Sharma, founder and MD, 35North Ventures
In my opinion, startups in the current ecosystem require streamlined regulations and government support for initial R&D funding to compete globally.

For investors, better alignment of taxation on unlisted equities would allow better capital inflow.

Neha Bagaria, founder & CEO, HerKey (formerly JobsForHer)
As India gears up for the annual budget, I advocate for a targeted strategy to upskill women returnees in future-ready skills. A joint effort by the government and corporate India can pave the way for incentives and tax breaks for companies investing in the training of these women. Aligning with the evolving landscape of future skills is essential for fostering a resilient and diverse workforce.

Let this budget signify a strategic commitment to inclusive growth, where the development of these skills becomes a cornerstone for a dynamic job market, creating opportunities for women on a career break.

Srirang Srikantha, gounder & CEO, Yethi Consultancy
The digital-first approach by the government is a remarkable step in ensuring quicker resolution and service delivery of public services and initiatives. Aadhar and UPI services are a great testament to this. Now it’s time to take a step further and bring citizen-centric services into the ambit of digital public infrastructure (DPI). We recommend a comprehensive digital strategy that ensures robustness, application reliability, and accountability around the build, test, validation, and uptime of the applications across the entire digital public infrastructure (DPI)."

Yogesh Kabra, founder, XYXX Apparels
If investor confidence and fast-maturing markets are any indication, India is poised to become a global hub for innovation and entrepreneurship. I am optimistic about the government's commitment to building the burgeoning startup ecosystem in India and strongly anticipate that there would be significant strategic investments and initiatives towards better tax structures, customised support programmes, easy and simplified access to capital, and incentives for technology as well as process innovation. Ongoing training and upgradation of skilled workers, especially in the manufacturing and retail sectors, needs a massive boost to build a more robust, inclusive, and efficient workforce, especially as Tier 2 and Tier 3 markets witness rapid, unprecedented growth.

Ravi Gupta, founder, Guptaji Invests
Tax benefits should be given to startup investors, as they are taking the highest risk by investing in an asset class that has the lowest success ratio. The more strategic investments happen in fundable startups, the more India as a nation will become a better place to live, as what a proper startup does is solve a burning problem. But precautionary measures should be taken so that India will not become a 'tax haven' and investors don't do money laundering.

Due to the Angel tax levy, investments are not happening much in the highest-risk asset class startups. Tax benefits to startups should be increased from 3 years to 5 years or more. The government should not consider it a revenue loss but rather an investment from the government side for a brighter future, a better India, and the best-case scenario to make India the best nation of all.

Somdutta Singh, serial entrepreneur, founder and CEO Assiduus Global Inc, LP angel investor, and advisor, Govt of India
Startups: The anticipated 2024 budget should try and address credit challenges faced by SMEs. Potential measures should ideally include facilitating government-backed loans and encouraging NBFCs to increase lending to SMEs. In 2023, access to credit was identified as a key growth driver for many SMEs. The budget might propose incentives for SMEs engaged in research and development, such as tax breaks or government grants, to stimulate innovation in this sector.

I eagerly await government policies that attract both domestic and foreign capital, fostering growth in India's startup ecosystem. Providing tax credits for early-stage startups is crucial for incentivising innovation, and I hope the government addresses the ongoing concern of angel tax, paving the way for smoother operations.

Investors: The budget should consider providing incentives for both domestic and foreign investors engaging in gender-lens investing in India. Efforts should be made to streamline regulatory and policy hurdles, fostering increased involvement of women in the business landscape. Unlocking the potential of women entrepreneurs is vital for India to realise its ambitious goal of becoming a $30 trillion economy by 2047.

Jyoti Bhandari, founder and CEO, Lovak Capital
Budget 2024 should prioritise skill training, especially for young women in Bharat, offering vocational programmes after Class 12. Further, it should meet its promise to encourage the evolution of "Lakhpati Mahilas" from Women’s Self-Help Groups. This shift would not only catalyse rural economic growth but also secure substantial growth in SHG networks. The growth of successful women entrepreneurs from these groups must also be encouraged by aiding the transition of their enterprises into larger value chain-focused producer organisations. Focusing on the role of women in agriculture and exploring their potential contribution to various non-farm sectors will also empower women across Bharat, contributing to India's goal of becoming a global economic force. Budget 2024 holds the potential to create a more inclusive and prosperous future for women in the country.

Amit Relan, co-founder and CEO, mFilterIt
We expect to see a significant focus on transparency, data protection and privacy, and AI technology. With the world adapting to artificial intelligence, we expect to see swift adoption of technology and leveraging it for further digital advancements. Alongside that adequate funding for cybersecurity measures is crucial for fortifying the digital infrastructure. The balance between innovation and protection will ensure the holistic development of the digital ecosystem.

Hyder Khan, CEO, Godawari Electric Motors
I eagerly anticipate the upcoming budget with optimism and a fervent hope for increased support for the electric mobility sector. The extension and enhancement of the FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme would be instrumental in propelling India towards a sustainable and eco-friendly future. Substantial subsidies for electric vehicles and related infrastructure would not only incentivise consumers but also bolster the growth of our industry. These measures will not only promote cleaner transportation but also stimulate innovation and job creation. I look forward to a budget that recognises the pivotal role electric mobility plays in achieving environmental goals and economic development, and I trust that the government will continue to foster a conducive ecosystem for the electric vehicle industry to thrive.

Amit Jain, founder, Paaduks
As Paaduks, a pioneering MSME sustainable footwear manufacturer, we eagerly anticipate the upcoming Interim Budget 2024 with hopeful optimism for the growth and sustenance of our industry. The MSME sector has been the backbone of our economy, and we look forward to policies that further support our growth, such as streamlined access to credit and incentives for innovation. Furthermore, corporate tax reforms play a pivotal role in fostering a conducive business environment and enabling businesses to reinvest in research and development, thereby promoting sustainable practices in our manufacturing processes.

In conclusion, we look forward to an Interim Budget that not only acknowledges the significance of MSMEs but also fosters a holistic and sustainable ecosystem for the growth of businesses like ours.

Vinay Gupta, chairman, Acquaviva India Pvt Ltd
As the eagerly anticipated budget approaches, sanitaryware retailers articulate their aspirations for taxation policies that could significantly impact the industry's dynamics. With a keen focus on exports, retailers are advocating for pragmatic measures that would fortify the global competitiveness of domestic sanitaryware manufacturers.

On the imports front, retailers seek a reduction in customs duty on essential raw materials and components not readily available domestically. This move aims to lower production costs, making sanitaryware more affordable for consumers. Furthermore, by advocating for temporary duty suspensions on imported machinery or specialised equipment, retailers envision a technologically upgraded and modernised sanitaryware industry.

Amit Mishra, co-founder of 91Squarefeet
To catalyse the spirit of entrepreneurship in India, the upcoming Union Budget 2024 should pave the way for a progressive and inclusive capital gain regime for startups, like the ones enjoyed by listed companies. This move will stimulate increased investment in the startup ecosystem and unlock unprecedented growth opportunities. Addressing ESOP taxation for startups is vital to attracting and retaining top-tier talent and fostering innovation and excellence.

A holistic review of the regulatory framework is essential to creating a more conducive and less stringent environment, empowering startups to thrive and contribute significantly to the nation's economic landscape.

Ankit Agrawal, CEO & co-founder, InsuranceDekho
In the interim budget, we want the government to support the startup ecosystem by further easing the ease of doing business. While it’s easy to start a business in India today, it is paramount to ensure that it strives and thrives. The majority of startups fail, and hence it’s equally important to not only ease starting up but also make it easier for entrepreneurs to move on in case they are not able to establish a market-fit product. While the government is taking initiatives to promote entrepreneurship in India, we request that the government set aside more funds, provide access to newer technologies, ease tax rules, and further simplify regulatory requirements to encourage people to start their businesses.

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Union Budget 2024