2 February 2023
The Union Budget 2023-24 unfolds the vision of ‘Amrit Kaal’ which reflects an empowered and inclusive economy, focusing on the economic agenda with a prior focus to empower the youth and stabilise the macro economy by facilitating ample opportunities and prioritising the strong impetus to growth and job creation.
Finance Minister Nirmala Sitharaman said that unleashing the youth power is one among the seven priorities of the budget, which will act as a Saptarishi guiding the nation through the Amrit Kaal. With an expected GDP growth of 7 per cent in the fiscal year, the government proposes to support the economy via policies to scale up the operations of startups to project them to unicorns in the budget.
The proposed launch of a unified Skill India digital platform, which will focus on demand-based formal skilling, linking with employers, including MSMEs, is another boost to further foster entrepreneurship. Also, to strengthen the MSME sector, the Government proposes to revamp the credit guarantee scheme for the MSMEs, which will further enable additional collateral-free credit of Rs 2 lakh crore to the sector. Above all this, the updated tax slab which gives an edge for taxpayers by increasing rebates and ensuring that there is no income tax levied up to Rs 7 lakh in income, is the most welcomed and celebrated proposal.
ETHRWorld interacted with the HR leaders to know their take on the Union Budget 2023-24 and get to know about their budget observations from an HR perspective touching the points of employment, skilling and future of work.
Take on Budget 2023
Col Gaurav Dimri, Director - HR, Sharda Group, says the Budget 2023 reflects the aspirations of modern India. He further says that the vision of inclusive development with a technology-driven knowledge-based economy will get a boost with this landmark budget. “And, the focus on tourism, agri credit, education, infrastructure, capex, urban development and revised IT slabs will strengthen the foundations of growth and progress and lead our country to a bright future,” Dimri adds.
In the words of Kartik Iyer, HR Head, Covestro, “Union Budget 2023-24 is a beacon of hope for the nation, with a focus on job opportunities, diversity and inclusion, empowering the youth, and providing the necessary skills for a human-centric future.” He gives a kudos to the Finance Minister for presenting a budget that would enable the country to be a superpower in the future and a true marketplace for global talent supply.
Puneet Khurana, Group Head - Human Resources, Policybazaar & Paisabazaar, says, “This year’s budget is commendable as it recognises that the power of our country lies with the youth.” He further says that the budget infuses new energy into India’s youth power by including it in the seven priority focus areas.
Dr KS Bhoon, Head - HR and Business Excellence, RDC Concrete, points out that the substantial increase in capital investment outlay in the Budget 2023, which is almost three times the outlay in 2019-20, is a testament to the government's commitment to enhance growth potential and job creation, crowd in private investments, and provide a cushion against global headwinds.
Saud Zafar, an HR Expert, opines that this budget presents a pragmatic approach, emphasising sustainable growth across all sectors. He says that the tax benefits have been tweaked to encourage individuals to move towards the new tax regime and to provide marginal relief to the middle class.
Reflecting a similar notion, Partha Patnaik, Global Head of Human Resources, Profilics, reiterates that the government has adopted a well-balanced approach in this budget which not only meets the expectations of the salaried class, but also ensures that the taxpayer base is not eroded.
Encouraging companies to hire more workers
According to Kaushik Chakraborty, Chief People Officer, Savills India, the Union Budget 2023 provides a shot in the arm for the job market, with a clear emphasis on skilling, reskilling and employment generation. He says that this is a step forward in ensuring that India's workforce remains relevant and competitive in the rapidly evolving global marketplace.
Chakraborty further says that the budget recognises the importance of improving the overall business environment, which will help to create new job opportunities and encourage job growth across all sectors. In addition to these measures, the budget also proposes measures to support job seekers, including tax benefits, employment subsidies, and other incentives to encourage companies to hire more workers.
“This will not only help to create new jobs but also make it easier for workers to transition into new roles, which will be particularly important in an era of rapid technological change and increased competition for jobs,” Chakraborty points out.
Advent of 5G will create a future ready workforce
Priyanka Anand, Vice President and Head - HR, Southeast Asia, Oceania & India, Ericsson, says that skill building is a critical first step in nation building and with the advent of 5G and related technologies, creating a workforce that is future ready is imperative.
She asserts that it is heartening to see the government investing in building a digital-ready workforce of the future through Pradhan Mantri Kaushal Vikas Yojana (PMKVY) 4.0 offering training for Industry 4.0, AI, robotics, IoT and drones.
“This will help address the requirement of 22 million skilled workers in the telecom sector by 2025 and contribute to the nation becoming self-reliant. In addition, the 100 5G labs and three CoE for AI will foster the growth of the 5G ecosystem and fuel innovation. These initiatives will aid in bridging the skill gap and will enable the country to realise the Digital India vision,’’ Anand adds.
In the budget, the Finance Minister announced that India will set up three centres of excellence (COE) for artificial intelligence (AI) at top educational institutions to develop cutting-edge AI solutions in the country for realising the vision of ‘Make AI in India and Make AI work for India.’ In addition, 30 Skill India International Centres will also be established across states to prepare the youth for international opportunities.
Binu Philip, CHRO, Greater India Zone, Schneider Electric, says, establishing Centres of Excellence for Artificial Intelligence across top educational institutions will play a pivotal role in preparing the workforce for the future. If rolled effectively, he says, all these initiatives will act as a game-changer for the Indian economy and allow India to emerge as a global talent hub in the Amrit Kaal.
Janet Paul, Director - Human Resource - APJ & ME, Securonix, opines that these initiatives are helping address a key industry concern of talent acquisition by closing the skill shortage gap and retaining talent within the country.
Paul further says that as Pradhan Mantri Kaushal Vikas Yojana 4.0 will be launched to skill lakhs of youth over the next three years through on-the-job training, industry partnerships, and course alignment with industry needs, this scheme will also cover Industry 4.0 courses such as coding, AI and robotics.
Khurana of Policybazaar & Paisabazaar also adds that under the PMKVY 4.0 scheme, the country's youth will learn new-age courses such as Robotics, Artificial Intelligence (AI), Internet of Things (IoT), Data Analytics and many more. He is of the view that this will open a myriad of opportunities to augment their professional career and add value to businesses worldwide.
Rahul Kalidindi, CEO, Akrivia HCM, says, “We are looking forward to contributing to the ecosystem with a made in India, AI-enabled, all-comprehensive talent lifecycle management for these growth engines and large industry players for and beyond India.”
As the proposed green growth efforts will help in reducing carbon intensity of the economy, Somraj Samin Roy, Senior Vice President, CEAT, says, “The budget’s focus on increasing investment in green mobility reflects our move towards a stronger and more sustainable future.”
Philip of Schneider Electric also says that the budget reflects the government’s resolve for inclusive development of India. He adds, “With the impetus on green growth efforts, we will not only fast forward the country on its net-zero mission, but also open up large-scale green job opportunities.”
Tax deduction will attract more talent
Gauri Das, VP and HR Head, India Factoring and Finance Solutions, puts forward that the tax deduction for highest income groups may make India more attractive for talent. She is of the opinion that the changes in the income tax slab will boost the economy and benefit taxpayers. She says that it is after a long time that slabs have been changed and interest of salaried class has been taken into consideration.
Das adds that the new tax regime has not been popular so far and now that it’s default regime and has added the benefit of standard deduction, she says it will be interesting to note whether it becomes attractive now.
Charu Malhotra, Co-Founder and CHRO, Primus Partners, expresses that it is heartening to see a reduction in tax rates as it will provide a much-needed cushion to the youth as well as the retiring employees. She foresees that the companies may also attract and retain talent by structuring packages to get the maximum benefits from the new tax regime.
Avadhesh Dixit, CHRO, Acuity Knowledge Partners, adds that for salaried professionals, the budget, through higher capex and infra spending, is focused on increasing employment levels. He symbolises the relaxation in the slab rates as the Secret Santa Gift everyone wished for. Given the high inflation, he asserts that tax relief under the new tax regime is a welcome relief for lower-earning individuals.
People-centric approach budget
Sumanpreet Bhatia, VP - Human Resources, Exotel, also embraces the recent changes proposed to the tax regime as a step forward for supporting salaried employees. According to Bhatia, the proposals not only offer a more favourable tax structure, but also a higher rebate for those with an income up to Rs 7 lakh.
Bhatia says this coupled with the standard deductions for salaried individuals and family pension, sends a clear message that the wellbeing of employees is a priority. She stresses that these changes are a reflection of a people-centric approach to managing finances and will have a positive impact on the lives of the workforce.
Greater savings for younger generation
Giving her take on the new tax regime, Ruchira Bhardwaja, President & CHRO, Kotak Mahindra Life Insurance Company, says that it is beneficial for the workforce entering the job market for the first time. She points out that hopefully, it would lead to greater saving as well as build an investment mindset in the younger generation.
Commenting on the updated tax slab, Shoma Bhardwaj, Senior Manager - HR, PEPPER Interactive Communications, says that the salaried individuals, especially the mid-level professionals, face the eternal dilemma of balancing their monthly or annuals spends, investments and deriving exemptions for better savings. Hence, enhancing the tax rebate limit to Rs 7 lakh in the Union Budget is a step forward to achieve this balance and plan better financial health for individuals and families.
Change in surcharge rate is a relief for CXOs
Mayank Rautela, Group CHRO, CARE Hospitals Group, says that the point of contention of all salaried individuals in the country has been a hot topic ever since the salaried class upgraded to social media and the internet. He asserts that the budget session is the most sought-after programme during this time of the year, solely to understand the savings that can be managed from TDS.
In regard to this year’s changes in the personal taxation system, Rautela affirms that it definitely looks like the proposal of a new tax regime which will become the default system, which will bring in more self-governance.
“The new tax regime has ZERO tax for income up to Rs 7 lakh, revised tax slabs may provide some relief to the taxpayers, and change in the highest surcharge rate from 37 per cent to 25 per cent will surely bring in some relief to the CXO suite!” adds Rautela.
Leave encashment a boon for retirees
Das of India Factoring and Finance Solutions also appreciates the tax reduction on leave encashment. She says this will give more money in the hands of retirees too. “One-time small saving scheme with 7.5 per cent interest rate is a good move to bring in inclusion. As it is available only for two years, it may not be a significant instrument, but it will surely encourage financial inclusion and independence,” Das points out.
Entrepreneurship development and sector-specific skilling
Bhoon of RDC Concrete is glad to see the government's commitment to support the growth and development of the industry and the country as a whole. He says that the National Apprenticeship Promotion Scheme and the dedication to providing stipend support to 47 lakh youth in three years is a commendable step towards empowering the youth with the necessary skills and knowledge to succeed in the job market.
“It is great to see the government's focus on sector-specific skilling and entrepreneurship development, as well as the emphasis on dedicated multidisciplinary courses for medical devices. These initiatives will not only support the growth of our industry but also provide a more sustainable future for the country. We look forward to contributing to this vision by investing in increasing our footprints which will create more job opportunities for our talented and hardworking workforce," Bhoon adds.
Das of India Factoring and Finance Solutions opines that the budget has multiple announcements focused on the MSMEs sector which plays a critical role in the GDP and employment generation. She says that as startups are amidst the funding winter, proposals for startups like extension of tax holiday and benefit of carry forward loss will help a lot. She also points out that the Skill India digital platform will help enable demand-based skills and also link them with employers which is a win-win situation for both.
Lohit Bhatia, President - Workforce Management, Quess Corp, points out that the focus on PLI sectors like mobile and electronic manufacturing assembly lines creates medium to long-term assembly line, semi-skilled, and skilled jobs, which benefits both domestic and export output.
Bhatia says the removal of nearly 39,000 compliances, decriminalisation of 3400 legal provisions, and Jan Vishwas Bill, as well as PAN as a common unified identifier will enhance the nations’ ranking and actual ease of doing business, thereby encouraging more private investment and FDI into India.
Rautela of CARE Hospitals Group says that overall, the budget touches each industry and is aimed towards boosting the economy with minimal fiscal deficit in the Amrit Kaal.
He further says that the focus to upgrade Amrit Pidhi through on-the-job training, new age courses, and new Nursing Colleges is a good initiative.
“Opening 157 Nursing Colleges will really strengthen our Healthcare system in the years to come. For the Health department (including the Healthcare workers, primarily Nurses and technicians), this would provide the major boost needed,” Rautela adds.
Bhardwaja of Kotak Mahindra Life Insurance Company is of the view that the continuous focus on capital investment allocated by the Union Budget is another welcome move as a driver for growth and job creation. She believes that the emphasis on Eklavya tribal schools and Skill India digital platform will create a steady skilled workforce across India.
While applauding the announcements, Das of India Factoring and Finance Solutions puts forward that the devil lies in the details and the execution. And, “We will have to see how it works out for implementation,” she adds.
Bhatia of Quess Corp concludes that the budget should not be seen as a board exam that happens only once in the 10th and 12th standard, respectively. It should be viewed with intention and continuity of medium to long-term policies.
Let us too look forward to experiencing how the proposed initiatives get accelerated in the work world in the days ahead!
Reference Link: https://hr.economictimes.indiatimes.com/news/industry/union-budget-2023-receives-thumbs-up-from-hr-community/97540819