Finance Minister Nirmala Sitharaman presented her eighth consecutive Union Budget, announcing major reforms for the ease of doing business and measures to support MSMEs and startups.
Ms Sitharaman announced that requirements and procedures for speedy approval of company mergers will be rationalised. She said, "In the last 10 years, many aspects of the government have demonstrated steadfast commitment to ease of doing business."
The government has announced a high-level committee will be set up for regulatory reforms in the non-financial sector. "The Centre will aim to strengthen trust-based economic governance to ensure the ease of doing business," she said. The high-level committee will review all non-finance sector regulations, licenses, certifications and permissions.
The government will set up an investment-friendliness index for states as well. The measures come along with a credit boost for MSMEs and startups in India. Along with this, Jan Vishwas Bill 2.0 will decriminalize over 100 provisions in various laws, helping businesses.
A mechanism will be set up under the Financial Stability and Development Council to evaluate the impact of current financial regulations.
Ms Sitharaman also announced tax reforms for business. "A tax exemption will be provided on withdrawals made from the National Savings Scheme by individuals on or after 29th August 2024, along with a scheme to be introduced for determining arm's length price of international transactions for a block period of three years, to streamline transfer pricing and to provide an alternative to yearly examination."
"MSME, as a second engine, encompasses manufacturing and services with a focus on MSME numbering 5.7 crore. Currently, over 1 crore registered MSMEs employing 7.5 crore people and generating 36% of our manufacturing have come together to position India as a global manufacturing hub," Ms Sitharaman said.
According to Ms Sitharaman, the government will improve the credit guarantee cover for micro and small enterprises to Rs 10 crore from the current Rs 5 crore. An additional credit of Rs 1.5 lakh crore will be given in the next five years, she said. For startups, the credit guarantee cover will be enhanced to Rs 20 crore from the current Rs 10 crore - with a guarantee fee down to 1 per cent for loans in 27 focus sectors which, according to Ms Sitharaman, will be important for 'Aatmanirbhar' Bharat.
