With more expectations adjoining this New Year, the Union Budget for the financial year 2022-23 is also the one for which everyone has an eye. Also called the Annual financial statement, the union budget is presented every year by the government of India. As per Article 112 of the Indian Constitution, it is ‘a statement of the estimated receipts and expenditure of the Government of India for that year’.
Nirmala Sitharaman, the finance minister of India is all set to present the Union Budget for the financial year 2022-23 on 1st February. Saying that, the Micro, Small & Medium Enterprises (MSME) sector is optimistic about the same. Below are top 5 things MSME’s can expect in the union budget of financial year 2022-23:
Optimism for Banking Industry
There is a vital role of NBFC in supplementing the banking industry,
People are optimistic that the budget of this year will provide the much-needed impetus to the economy considering the downturn and degradation due to the crisis last year.
Increased Allocation in Healthcare Sector
Yes, it is genuine and people have high expectations belonging to this sector in 2022. This includes the allocation in the healthcare sector across the entire infrastructure, where the special focus should be on a reliable medical cold chain for the success of any NIP (National Immunization Programme). This will ensure that the country will be prepared beforehand to fight the pandemic and any other future crisis.
Complete Funding of “Atma Nirbhar Swasth Bharat Yojana”
As we all know that last year, the finance minister launched – ‘Atmanirbhar Swasth Bharat Yojana’, with an outlay of about Rs 64,180 crore over 6 years, with a promise that “Progressively, as institutions absorb more, we shall commit more”.And, now the time comes when we are eagerly waiting for the complete funding to be announced to reach the targets set in the National Infrastructure Pipeline 2020.
As we can see, the raw materials’ prices are very high and it’s not uniform and controlled. In this case, the government should at least rationalize the GST on manufacturing for MSME. Experts suggested in this field that GST for manufacturing should be brought down to at least 12 percent from 18 percent.
Recapitalization of Public Sector
We are also optimistic about a pick-up in overall credit demand across India. There should be a push towards affordable and rental housing and reinforcing the existing financing systems to provide liquidity to stuck real estate projects.
Highlights of Union Budget 2021-22
● In the union budget 2021-22, i.e. the last year, the number of steps were taken to support the MSME sector and the Government has provided Rs. 15,700 crore to this sector – more than double of this year’s BE.
● The Budget proposes certain changes to benefit MSMEs which include increasing duty on steel screws, plastic builder wares and prawn feed.
● It also provides for rationalizing exemption on import of duty free items as an incentive to exporters of garments, leather and handicraft items. It also provides a withdrawal exemption on imports of certain kinds of leather and raising custom duty on finished synthetic gemstones.
It’s noteworthy that Nirmala Sitharaman, the Union Finance Minister of India held a pre-budget meeting on December 30th 2021 with all the state finance ministers. This was a part of a series of consultations held in the run-up to the Union Budget 2022-23.
Hope for Good. Hope for the Best.
Authored by Virendra Ranawat, Co-Founder, WoodenStreet