The Union Budget 2024-25, recently unveiled by the Indian government, has drawn significant attention for its ambitious agenda to drive the nation’s economic growth. Among the many voices responding to this budget, Rizwan Soomar, CEO and Managing Director of DP World North Africa and India Subcontinent, provided an insightful and optimistic perspective on the potential impacts of the proposed fiscal policies.
In a detailed reaction to the budget announcement, Soomar emphasised that the substantial allocation towards infrastructure investments, amounting to a record Rs. 11.11 trillion ($132.85 billion), is a crucial move to propel India’s growth trajectory.
Catalyst for growth
“The fiscal budget is a strong move towards accelerating India’s growth trajectory with steadfast focus on infrastructure investments,” Soomar stated. He highlighted that the government’s commitment to boosting infrastructure spending is likely to have far-reaching effects on the economy.
Improved infrastructure will not only facilitate smoother and more efficient movement of goods but also attract significant foreign investments, thereby integrating India more deeply into global manufacturing and value chains.
Foreign investment
One of the notable features of the budget is the reduction in corporate tax rates for foreign companies. Soomar pointed out that this measure is poised to attract overseas companies and capital, positioning India as a vital player in the global manufacturing landscape. The lower tax rate makes India a more attractive destination for multinational corporations looking to expand their operations, thus fostering economic growth through increased foreign direct investment.
Skill development
Soomar also commended the budget’s focus on enhancing the skill set of the country’s youth.
“Prominent measures on enhancing the skillset of the country’s youth and incentivising them to join the formal sector is commendable,” he said.
By investing in education and vocational training, the government aims to equip the younger generation with the skills needed to thrive in a rapidly evolving job market. This initiative is expected to not only reduce unemployment but also drive innovation and productivity across various sectors.
Duty rationalisation
The budget’s decision to rationalise duties on certain products, including mobiles, marine items, leather, and textiles, was also praised by Soomar. He noted that such measures would enhance the export competitiveness of Indian products.
By reducing the cost of exporting these goods, Indian manufacturers can offer more competitive prices in international markets, thereby boosting export volumes and contributing to the overall growth of the economy.
Integrated industrial parks
Soomar highlighted the significance of the government’s plan to establish more integrated industrial parks and e-commerce export hubs.
“The decision to set up more integrated industrial parks and e-commerce export hubs will facilitate manufacturing output, boost domestic consumption as well as enhance trade and logistics activity,” he remarked.
These hubs are expected to create a more efficient supply chain network, reduce logistical costs, and promote domestic manufacturing. Additionally, they will support the burgeoning e-commerce sector, making it easier for small and medium-sized enterprises to access global markets.
