What M&E industry hopes to see in the Union Budget 2024

New Delhi: Finance Minister Nirmala Sitharaman presented the interim budget on February 1 and is set to unveil the annual budget on July 23, 2024. The advertising, media and marketing sector eagerly awaits a budget that will drive digital innovation, clarify advertising guidelines, and promote AI-driven personalisation.

Key stakeholders hope for government initiatives that boost consumption, reduce custom duties on newsprint and high-speed printing presses, and prioritise AI, content creation, digital privacy protection, and digital literacy. 

Sivakumar Sundaram, CEO (Publishing), BCCL, expects the budget to stimulate private consumption by investing in initiatives to increase employment and perhaps reduce income tax rates.  

“This will have a positive impact on advertising during the festive season as it will act as a multiplier on a large number of e-commerce sales festivals, car launches, and mobile phone launches already planned over the next three months,” he said.  

He also said that there is an underlying hope that the government will consider the removal of the 5% customs duty on newsprint and the reduction of customs duty on high-speed printing presses. 

The global radio market is well-positioned for substantial growth, driven by technological advancements and evolving consumer behaviours. In India, the radio sector closed in 2023 with a valuation of approximately Rs 23 billion, with forecasts suggesting a compound annual growth rate of 7-9%, reaching Rs 27 billion by 2026.  

However, Ashit Kukian, CEO, Radio City, believes that challenges persist, particularly in advertising effectiveness on radio compared to digital alternatives and geographical constraints.  

Therefore, overcoming these hurdles requires strategic investments in infrastructure and digital integration, empowering radio to compete effectively in the digital age and broaden its reach, said Kukian.  

“As stakeholders in this dynamic industry, we look to the upcoming budget to champion policies that support innovation, infrastructure development, and talent enhancement,” commented Kukian.

He further urged policymakers to prioritise AI-driven advertising initiatives, ensuring a conducive environment for the radio industry's growth and endurance.

Kunal Vora, Founder-Partner, ABND, expects the budget to support policies and incentives for SMEs. “Strengthening these enterprises is crucial for fostering innovation and job creation. By providing financial assistance and easing regulatory hurdles, the government can create fertile ground for brands to grow and expand their market presence, ultimately driving economic prosperity and resilience.”

Vora also asserted that a renewed focus on domestic manufacturing and 'Make in India' will create substantial opportunities for the branding industry. 

He added, “As local products gain prominence, businesses will require sophisticated brand-building strategies to compete effectively. We anticipate a surge in demand for brand identity development, packaging design, and marketing communications to support the growth of indigenous products and establish a strong market presence.” 

Mautik Tolia, Managing Director, Bodhitree Multimedia, looks forward to measures that will boost India’s global competitiveness.  

Tolia expects the government to increase subsidies for international production to attract more business. For example, special tax SOPs should be given to the VFX and animation industry on their international work orders, he suggested.  

Tolia added, “We expect the establishment of a dedicated fund by the government to boost content creation and the media technology space, with a special focus on investing in AI and content creation, keeping the international markets as the target."

Seconding the thoughts of the leaders mentioned above, Prady, CEO and Managing Partner, NP Digital India, highlighted that for marketing agencies, strategic budget allocations towards digital transformation, creative innovation, and cross-platform strategies will be crucial.  

“We hope the government will focus on increasing capital expenditure in infrastructure, providing tax incentives, and enhancing liquidity to stimulate consumer spending. These measures will directly impact marketing expenditures positively,” Prady added. “Additionally, specific support for MSMEs and the burgeoning startup sector through financial assistance, tax benefits, and digital adoption incentives will empower these businesses to scale their marketing efforts. By fostering an environment of innovation and growth, the budget can pave the way for a thriving advertising/marketing ecosystem."

Krisneil Peres, Co-Founder and CVO (Chief Visionary Officer) at Fame Keeda, said that there is a strong desire for supportive fiscal policies that encourage innovation and growth across the advertising industry. “This includes expectations for tax incentives that stimulate investment in digital infrastructure and technology, essential for keeping pace with global standards,” said Peres.

He believes that there is a need for clear guidelines that not only ensure fair competition but also uphold consumer privacy and data protection. This regulatory framework is crucial for building trust among users and stakeholders alike.

Peres champions the cause of initiatives that promote digital literacy and skill development. As digital technologies continue to evolve rapidly, there is a growing need to equip the workforce with the necessary skills to thrive in this digital-first era. 

He added, “The outcome will likely shape the industry's trajectory, ensuring it remains competitive and resilient in a globalised digital landscape." 

Apurv Modi, Managing Director and Co-Founder of ATechnos Group, said, "The expected income tax rate cuts and the proposed increase in the income threshold to ₹5 lakh are promising developments. These measures will enhance disposable income, stimulate consumer spending, and drive growth across industries, including mar-tech.”

He also added that there is considerable anticipation for initiatives that simplify the ease of doing business and support the growth of digital infrastructure. Such steps will create a robust environment for martech companies to innovate and expand, ultimately contributing to the broader digital economy.

Russhabh R Thakkar, Founder and CEO, Frodoh World, looks forward to a boost in digital advertising, given the government's push for a digital economy. 

Thakkar said, “We expect increased allocations for rural broadband and 5G rollout, which could expand our addressable market. Compared to the last few months, we might see more support for local content creation and AdTech startups.” 

Thakkar also believes that the upcoming Union Budget may introduce policies that indirectly bolster India's retail media landscape, including funding allocations aimed at strengthening digital infrastructure and data security, which are crucial for the growth of e-commerce platforms and their advertising capabilities. 

He believes that the budget might also address regulations around data usage and privacy, potentially shaping how retail media networks operate and monetise their first-party data. 

He added, “A key area to watch is any announcement on regulating emerging technologies like AI in advertising. This could have far-reaching implications for personalisation and ad fraud prevention. Lastly, given the global economic headwinds, the budget might include measures to attract more foreign investment in our AdTech sector, potentially accelerating innovation and growth." 

Vaibhav Gupta, Co-founder and CPO of KlugKlug, believes that this budget sets the stage for a future where innovation and entrepreneurship drive positive change, elevating India's position on the global stage.
 
He added that the emphasis on fostering economic opportunities and ensuring affordable, high-quality services reflects a commitment to inclusivity, reaching even those at the 'bottom of the pyramid.  

He said, “As innovators and entrepreneurs, we stand poised to contribute to India's rising global potential through our cutting-edge solutions." 

Gautam Madhavan, CEO and Founder, Mad Influence, said, “Mad Influence welcomes the government's commitment to maintaining stability in taxation and ensuring continuity for startups and IFSC units by extending tax exemptions till March 31, 2025. The Finance Minister's decision to withdraw outstanding direct tax demands up to Rs. 25,000 and provide relief to 1 crore taxpayers is a positive step towards improving taxpayer services. As the economy strides towards sustained growth, Mad Influence acknowledges the government's prudent approach to maintaining existing tax rates and embracing the positive impact of GST on trade and industry.” 

He also added that Mad Influence expects more targeted initiatives for startups in the upcoming full budget in July. The overall budgetary estimates, with a focus on interest-free loans, reflect a balanced approach towards economic growth. He said that the company anticipates further details in the detailed roadmap for 'Viksit Bharat' promised in the full budget, paving the way for a more prosperous and inclusive India.

Vikram Bhalla, Founder and Director, Vivify Asia, believes that the budgetary figures outlined reflect a prudent approach to fiscal management. The Finance Minister's estimate of total receipts, excluding borrowings, at Rs. 30.80 lakh crore and total expenditure at Rs. 47 lakh crore for the upcoming fiscal year demonstrates a commitment to responsible financial planning.  

He believes that the continuation of interest-free loans at an outlay of Rs. 1.3 lakh crore is a strategic move to support key sectors. The targeted fiscal deficit of 5.1% of GDP for 2024–25 aligns with the government's commitment to gradually reduce the deficit to 4.5% of GDP by 2025–26.  

He added, “This shows a balanced effort to stimulate economic growth while maintaining fiscal discipline.” 

He also highlighted that the mention of revised estimates for 2023–24, with revenue receipts expected to surpass the budget estimate, reflects the positive momentum in economic activities and formalisation.  

He concluded, “The government's ability to manage expenditures effectively is evident in this upward revision. While the overall vision for 'Viksit Bharat' is ambitious, the budget strikes a balance between addressing immediate concerns, investing in long-term growth drivers, and maintaining fiscal prudence.”