Union Finance Minister Nirmala Sitharaman on Wednesday presented the Union Budget 2023 in the Parliament. The announcements made have been received positively by players from the advertising world.
Some of the major developments under the new regime have been the announcement of increase in Income Tax rebate limit from Rs 5 lakh to Rs 7 lakh, 2.5% reduction of custom duty to promote value addition in TV manufacturing, revamping of Credit Guarantee Scheme for MSMEs through the infusion of Rs 9,000 crore into the corpus, expansion in the scope of documents available on DigiLocker, setting up of three Centres of Excellence for Artificial intelligence in top educational institutions and establishing 100 labs for developing applications using 5G services in the country.
Here's a summary of how the ad world has welcomed the Budget:
As per Kartik Sharma, Group CEO, Omnicom Media Group (India), India's 2023 budget is growth-oriented, future-focused, and abundant with reforms across all aspects of the economy, as it builds upon the momentum of the year gone by. In his opinion, the overall Budget is a progressive one which will widen the country's horizons and further strengthen India’s economic order on the global stage.
“At a time when all eyes are on India - poised to grow and thrive despite the looming economic slowdown, the standout for me is the strong thrust on Capex. The massive increase on this front shows the government's commitment to boost infrastructure, industry-agnostic productivity, and the overall economy,” he said.
Sharma also went on to point out that there is positive relief on the personal tax front - making it a friendly budget for the common man. And the increase in the taxation slabs itself is a well-concerted attempt to move people to the new tax regime, expected to benefit middle-class citizens in good time.
“Giving impetus to the digital economy and transformation continues to be a key focus, with new frontiers of innovation like Artificial Intelligence propelled front and centre - to galvanise its application across sectors ranging from agriculture to learning and others. The narrative for accelerated transformation is also evident across the education sector, with a heightened focus on upskilling the nation's youth in new-age skills and courses like AI, Robotics, IoT, and more,” he added.
Furthermore, Sharma also went on to add that as companies earmark their capex, advertisers will have their eyes set on these new policies and will go forth with buoyancy in their minds, as a result of which the AdEx too is expected to do well for the year.
Anurag Bansal, Chief Operating Officer and Chief Financial Officer, DDB Mudra Group, said that the advertising industry stands to gain as this budget will give impetus to consumption.
“It’s a well-balanced and progressive budget entailing fiscal prudence. Income Tax relief provided to the salaried class and middle class will help restore their buying power to a certain extent. No change in capital gain tax is a big relief to investors. Continued focus on capital expenditure, domestic tourism and agriculture will boost the economy, distribution, and consumption of goods and services,” he said.
According to Vibhor Gauba, Associate Partner- Deal Advisory, KPMG (India), Budget 2023 has aspects which positively impact the M&E segment in India - specifically the customs duty cuts on TV parts and mobile phone components are likely to boost local manufacturing, and help further the penetration of hardware in the industry, which at 72% TV penetration and 35-38% OTT penetration, has a long way to go.
Furthermore, Gauba also went on to point out that the Centre has also kept up with the push towards digital consumption with the National digital library and 100 labs for the development of 5G apps.
“In terms of new age technologies, 3 centres of excellence for Artificial Intelligence (AI) will help usher in innovation around M&E use cases. Lastly, more disposable income in the hands of the consumer will find its way to M&E consumption use cases as well, especially amongst the youth,” he added.
Speaking along similar lines, Arvind Mittal, MD and CEO, Mouli’s Advertising Services, said that Budget 2023-24 continues to maintain the stance which government had undertaken for the last couple of years for adding stimulus for economic growth.
“Encouragement to manufacturing, availability of higher disposable income to all, lowering of taxes, increased opportunities to skill, get employment and spend all augurs well for the growth momentum. There are enough provisions to increase investment in business,” he said.
Mittal also went on to point out that when consumption increases there would be a propensity on the part of businesses to promote their services and product, which will lead to increased spending on publicity and outreach.
“In addition to this, there are enhanced budgetary allocation to various public welfare schemes and introduction of new mass welfare schemes. Since the government uses dissemination of information as a tool for the public empowerment so that the public at large can avail of the benefits from the government schemes and programs, there will be increased spending by the government too on mass outreach and publicity,” he opined.
Moreover, Mittal also went on to state that this all sounds like music to anyone and everyone in the publicity and advertising industry, and said, “I feel, this Budget will not only rejuvenate but will also allow the publicity industry to grow strong and earn substantially.”
Further, Siddharth Dabhade, Managing Director, MiQ India, expressed that he is ‘excited’ about India’s promising digital growth story envisioned by the government.
“Budget 2023 focuses on greater investments in digital infrastructure that will drive India’s economy in the fourth industrial revolution. The budget facilitates opportunities for India to tap into its demographic dividend and boost the employability of our youth through the Skill India Digital Platform and building 30 Skill India International Centres across states. Initiatives under the revamped Pradhan Mantri Kaushal Vikas Yojana (PMKVY) 4.0 would catapult Indian talent with skills in emerging technologies such as AI, robotics, blockchain, IoT, 3D printing, Cloud computing, etc. We would also see skilling and capability buildout in AI with the planned 3 Centres of Excellence for AI to enable the vision of 'Make AI for India',” he stated.
Dabhade further went on to add that he is ‘confident’ that the government's focus on building out the 5G infrastructure with initiatives like setting up 100 labs for 5G service-based application development, will boost mobile penetration and drive the growth of the media and digital advertising industries.
Simi Sabhaney, Chief Growth Officer, dentsu India, also stated that her first reaction after reading about the priorities drawn out in this year’s budget was, ‘This is a perfect example of firing on all cylinders. India is preparing itself on all fronts, to take centre stage’.
“This budget is most comprehensive and well-balanced because it has taken into account the key building blocks that are essential to get us future-ready and fuel our growth in the coming years,” she said.
Sabhaney also went on to add that the current budget is all three- growth-oriented, inclusive and responsible.
“Focus on infrastructure development, sustainability, MSME lending, honing the power of AI by setting up centres of excellence, boosting tourism and hospitality sectors, launching digital libraries to provide quality education, setting up Skill India International centres to promote entrepreneurship, agriculture accelerator funds to promote agri-startups in rural India, new tax regime, use of technology to enhance financial inclusion, all this and more showcases the audacious confidence that India has unleashed,” she opined.
Meanwhile, Atul Shrivastava, Group CEO and Executive Director, Laqshya Media Group, said, “The Union Budget 2023 is a landmark budget for the advertising industry in India, with a host of measures to drive growth and innovation in the sector. The government's push towards green energy, the significant outlay for railways, urban infrastructure development, and the MSMEs and start-up development schemes are all positive indicators for the advertising industry.”
“The allocation of funds for 100 last-mile railway projects, more airports coming, and the urban infrastructure development fund will lead to increased transport growth and thereby create new advertising opportunities,” he opined.
Shrivastava also stated that in addition to the aforementioned developments, the new income tax slab will boost the lifestyle of salaried individuals, thereby boosting the Indian economy.
“This Budget is a clear sign that the government is committed to driving the growth of the corporate sector, and we can expect to see exciting new developments in the OOH advertising industry in the coming years. Moreover, as the movement of people out of their homes keeps growing - coupled with the government’s allocation of more resources towards improving infrastructure, a heightened demand for out-of-home media will be generated," he stated.
Soumya Mohanty, Managing Director and Chief Client Officer- Insights Division, Kantar, also said, “It’s a nice feel good budget that gets the fundamentals right and should spur domestic consumption by putting more money back in the hands of middle class, increased spends on infra, and emphasis on jobs.”
Sahil Chopra, Founder and CEO- iCubesWire, said, “The 2023 budget looks promising for the digital and technology sector. Emerging technologies such as 5G, Web 3.0, and Metaverse will give rise to new business opportunities. Moreover, implementing a comprehensive legal framework will strengthen personal data protection.”
“Investments in tech innovation and digital asset creation will facilitate the development of a knowledge-based economy, with leading educational institutes taking the lead. With the development of three Centres of Excellence for Artificial Intelligence in top academic institutions, we will move closer to making AI in India a reality,” he added.
As per Ambika Sharma, Founder and MD, Pulp Strategy, the 2023-24 Budget focuses on talent, technology, entrepreneurship, and sustainability.
“The effort towards boosting the economy at a time when the rest of the world is on the edge of a slowdown is commendable, we welcome the Union Budget 2023-24 and believe that India has a unique success story and with the new Budget, it has taken a step towards being a global technology leader as it favours the new-age digital economy and we look forward to further growth in the sector,” she said.
One of the important issues addressed herein, in the views of Sharma, was the stressed MSME ecosystem due to or in the duration of the pandemic.
“In case of failure by MSMEs to execute contracts during the Covid-19 period, MSMEs will get 95% of the forfeited amount relating to bid or performance security. This amount will be returned to them by the government and government undertakings. MSMEs are the growth engines of the economy, and this move will help to boost their morale and will provide them relief,” she opined.
As per Kalyan Kumar, Co-founder and Chief Executive Officer, KlugKlug, the Centre's capex objective for 2023-24 is Rs 10 lakh crore, which is 33% more than the budget projection of Rs 7.5 lakh crore for 2022-23.
“The government's emphasis on capital expenditure to stimulate economic development cannot be contested. What is actually important, though, is the resumption of the private investment cycle. When capacity utilisation exceeds 80% and demand is expected to increase, investments are made,” he said.
He also went on to add that another significant step forward in data accessibility will be the implementation of a National Data Governance framework that will provide access to anonymised data.
“Three artificial intelligence excellence centres to allow 'Make AI for India' and 'Make AI work for India' will be the next great thing in Indian technology,” he added.
Gaurav Arora, Co-Founder, Social Panga, stated that Union Budget 2023 was a wholesome, Saptarishi budget, addressing all the fundamental points and inclusive development model, necessary for overall economic growth.
“Enhancement in capital expenditure and improvisation of social-economic reforms of tribal communities are positive steps towards the upliftment of the economy. Prioritising green growth and digital libraries for children and adolescents brings in major shifts in outlook and focus towards a green economy and young India. The Union Budget 2023 was a fresh breeze ushering into futuristic developments,” he said.