Budget Reaction

Union Budget 2021 Reaction of Industry Leaders

Here is how Industry leaders from Metro & Railway sectors responded to it and shared their opinions.

Mr. Ashish P. Dhakan, MD & CEO, Prama Hikvision India Pvt. Ltd.

he Union Budget FY 2021-22 is a transformative budget with positive resolve for India to growTfurther with a vision of the AtmaNirbhar Bharat Abhiyan that compliments the ‘Make-in-India’ initiative ofthe Government. AtmaNirbhar Bharat is an expression of 130 crore Indians, who have full confidence in their capabilities and skills. The Union Budget has identified the six pillars of Atmanirbhar Bharat's vision. On behalf of Prama Hikvision, we welcome the progressive and visionary budget and look forward to economic growth and stability.

The budget has sincere intent to provide momentum to strengthen local manufacturing capabilities. The Production Linked Incentive scheme (PLI) is a welcome move by the government. The review of the customs duty structure is clearly seen as a move towards promoting the domestic manufacturing. We hope that the review of the custom duty structure will be done after extensive Consultation with the key stakeholders.

The move to strengthen the overall research ecosystem to boost innovation and R&D in the country, an outlay of Rs 50,000 crore, is being announced, for National Research Foundation. It is a big step for accelerating innovation and R&D in India. The budget clearly shows government’s mega thrust on developing Infrastructure, Road Transport, Waterways, Airports, Railway, Metro Rail, ‘MetroLite’ and ‘MetroNeo’ . It is commendable for its inclusive growth agenda, overall a gradual step toward Atmanirbhar Bharat.

By Kshitish Nadgauda, Senior Vice President Managing Director - Asia, Louis Berger

s the backbone of any economy, impetus to infrastructure is one of the key tools to give the Aeconomy a solid boost. It is one of the surest ways for an economic rebound, especially after the global health crisis which has slowed down and crippled many economies. Infrastructure has been a key focus area of the Government. It was therefore encouraging to see it amongst the top 2 pillars of the Budget for FY21-22 as announced earlier today by the Honourable Finance Minister, Ms. Nirmala Sitharaman.

In particular, we welcome the focus on continued investment in the development of urban mass transit (Metro Rail) projects in India. Such mass transit projects are vital to realize multiple benefits such as reduction in air pollution, time saving for commuters, reduction in accidents, reduction in traffic congestion, fuel savings, etc. The announcement of the central fiscal funding for Metro Rail Projects showcases the government’s continued focus on Metro connectivity. We welcome this move and believe that this will lead to building safe, world-class transportation facilities which would be availed of bythe common man.

We also welcome the proposals of the continued development of Economic Corridors. These road and Highway projects will boost the economy by creating thousands of jobs that are much needed during these times and attracting greater investment along the corridors because of the improved infrastructure. Additionally, the soon to be tabled bill on DFI (Development Financial Institution) is a much awaited step which will provide funding to construction in the Infrastructure sector. Additionally, we welcome the announcement of the new 11,000 km of proposed roads and highways in the states of Tamil Nadu, Kerala, Assam and West Bengal. We would urge similar investment in other states.

e believe that robust infrastructure is a pre-requisite for national development, economic Wgrowth and improving lives of citizens. Hence, it is good that the government has reiterated its commitment toachieving targets laid out underthe national infrastructure pipeline.

But creation and augmentation of infrastructure requires long term financing at reasonable rates. The setting-up of a professionally managed Development Financial Institution with targeted lending portfolio of Rs five lakh crores within three-years is therefore a welcome move since it shall act as a provider, enabler and catalyst for infrastructure financing.

The sharp increase in capital expenditure to Rs 5.54 lakh crores which is 34.5 per cent more vis-à-vis current year showcases that the government’s focus is upon infrastructure and allied sectors.

BY Mr. Himanshu Chaturvedi, Chief Strategy Officer - Tata Projects Ltd

In addition, the Rs 2 lakh crores being provided to States and Autonomous Bodies for their capital expenditure will further reinvigorate infrastructure creation at the state governmental level across India. This is especially important since the financial health of states and autonomous bodies have been hit badly due to the pandemic thereby restricting their abilityto upgrade and augment infrastructural Amenities.

Focus on national highway corridors, railway lines including electrification, and metro rail lines will lead to easier and cost effective transport of people and goods across the nation.

The Rs 2,87,000 crore Jal Jeevan Mission (Urban), which aims at universal water supply in all 4,378 Urban Local Bodies with 2.86 crores household tap connections, as well as liquid waste management in 500 AMRUT cities will provide enormous opportunities in this important sector. The AtmaNirbhar Bharat – Production Linked Incentive scheme wherein the government has committed nearly Rs. 1.97 lakh crores, over five-years starting FY 2021-22 will be a game changer, especially since it will provide a major fillip to construction of industrial and manufacturing facilities – both greenfield and Brownfield.

Continuation of tax benefits for affordable housing and tax exemption to rental housing will spur activity in the realty sector thereby providing support to a key industry and creating thousands of new jobs.

The long term prospects of India’s construction and infrastructure sector was always good because the nation needs better and augmented infrastructural amenities. With the impetus provided in this budget through policy and financial support – it will usher in higher growth across the construction and Infrastructure sector.

Rakesh Gaur

President of Railway Division at Kalpataru Power Transmission Limited.

Our Managing Editor Mr Narendra Shah had a conversation with Mr Rakesh Gaur, President of Railway Division at Kalpataru Power Transmission Limited. Mr Gaur gave a very consolidated reaction on the Rail & Metro budget. Here is the detailed conversation:-

Narendra Shah - How do you take the union budget 20212022? Please share yourviews.

Rakesh Gaur - The current union budget held great significance as it was the first budget post the COVID 19 pandemic. There is a highly focused approach on Capex other than Revenue Cost Allocations. Focus on Infrastructure and PLI schemes for AatmaNirbharta of the country will help in reviving the Indian economy as well as the job market. Narendra Shah - How do you think is the budget going to help the Railways ? Please share youropinion.

Rakesh Gaur - In The Budget’21, substantial increase in budgetary support as well as capital expenditure through EBR, reconfirms the government commitment on transforming the Infrastructure of National Transporter. The focus is on improving infrastructures by 100 % Railway Electrification by Dec 2023 as well as major focus on Urban Infra by supporting metro projects in Kochi, Chennai, Bengaluru, Nagpur and Nashik. High focus on safety by introducing the Automatic train Protection system on High Density and Highly Utilized Networks will upgrade the systems as well as facilitate to provide immense opportunities to Infrastructure sector. We also hope this will create lot of jobs in the construction industry foryouths. amount forRail and Metro Sectors? Howdo you thinkabout the future ofbusinesses in these two sectors?

Rakesh Gaur - The substantial increase in budgetary support to the Rail and Metro Sectors is a big boost to Railway Infrastructure. The government has already rolled out a National Rail Plan for India - 2030 which aims to make India future ready. The remodeling of Railway stations with ultramodern facilities, focus on Urban Infra through RRTS and Metro projects and high speed rail corridors and 100% Railway electrification is going to reform the entire transport ecosystem of the country. All the construction companies as well as MSMEs are going to be immensely b e n e f i t e d w i t h t h e s e b i g t i c k e t o p p o r t u n i t i e s . Narendra Shah - Many RRTS projects are coming up in NCR region. The metros are also expanding. What are the business prospects in the two sectors according to the budget?

Rakesh Gaur -The Government has identified 8 RRTS corridors in NCR region and out of these 8, three sections have approved for Phase 1 up to 2025. At the same time, the focus is also there on expending the metro networks all over India. In the budget ’21, the Finance Minister has proposed to deploy Metro Lite and Metro New technologies to provide metro rail systems in tier two cities and the peripheral areas of tier-one cities, at much lesser costs. A total of 702 km of conventional metro is operational and another 1,016 km of metro and RRTS is under construction in 27 cities.

The Government has provided support five Metro projects, which include Kochi Metro PhaseII, Chennai Metro Railway Phase-II, Bengaluru Metro Railway Project Phase 2A and 2B , Nagpur Metro Rail Project Phase-II and Nashik Metro . This will provide huge opportunities and excellent Business Prospects on long term basis.

Narendra Shah - Please share an overall comment on the budget.

Rakesh Gaur - Overall, this is a very positive and transparent budget. Noteworthily, all the Six Pillars i.e. Health and Wellbeing, Physical and Financial Capital and Infrastructure, Inclusive Development for Aspirational India, Reinvigorating Human Capital, Innovation and R&D, and optimum levels of intervention by Government and effectiveness of Governance, focused in the budget makes it a budget for Progressive India, for Healthier India and forAatmaNirbhar India. However, the key lies in execution and speed of execution.