Union Budget 2022: What start-up companies and MSME sector are expecting this year

The pandemic disrupted the world and life as we knew it, changed. After a two-year derailment of sorts, things are slowly starting to look up, but the third wave of the virus is raising its fangs too. But we are still hoping that the worst is behind us, and it is time now to slowly make the necessary changes and to move towards the other side of this global slowdown. As we get closer to the announcement of the government’s financial budget for the nation, I would like to highlight my expectations for the start-up environment and the MSME sector which is the medium-sized enterprises and how the government could focus on the taxation, funding or enabling cash flows. 2020 was sui generis in extreme ways for the world at large and yet in 2021, entrepreneurial India bounced back. In 2021, we saw a lot of start-ups getting funded. But along with funding, what we also need is a well thought out intent to help reduce tax burden on such investments that have happened in the past year. Also lessening the tax implication on M&A activities will be a big encouragement in this financial climate. Start-ups being taken over by another larger company face huge taxations and if they can have some relief in terms of that, then that would make the whole start-up environment more lucrative and help more entrepreneurs become more successful. The second thing that I want to discuss is a funding scheme that the government has, called the Start-Up India Fund Scheme. The government needs to be more active in start-ups that are directly impacting India’s economy. We have seen a lot of private investments and private equity come into the Indian market, whether they are Indian investors or foreign investors. The reason there is so much investment in the Indian community is because people see a very bright future in this market. The solutions that Indians have to offer are technologically advanced and our labour force is very driven in terms of achievements. The government now needs to create more such schemes to invest in start-ups and support them; to grow in the Indian market specifically by getting easy access to funds. Now, if we were to talk about the government’s investments as a percentage of private investments that have happened in the Indian market, the government investments are less than 10% of the overall investment value and that number really needs to increase. We need to see more support in terms of schemes that are launched for entrepreneurs to apply to and eventually get funding too. Finally, what I would like to cover is in terms of technological or digital infrastructure that the government has, in terms of supporting such start-ups. Today, if I am speaking as a start-up founder, there are so many administrative things that we have to go through to keep our companies up and running and even though most of it is digitalised currently, there is a huge challenge in terms of the amount of time that it takes to get through all the processes. So, the government needs to reduce paperwork and create a solid digital infrastructure, invest in digitalization of traditional services to help start-ups focus on their product or service and reduce the amount of time that they are investing in other non-revenue generating, non-profitable or other administrative procedures that are mandatory by the government. This could be in terms of tax filings and making the procedure much easier. It could also be in terms of jobs related to your PS schemes or ESIC schemes too. The government needs the whole digital infrastructure that they are building to support the ecosystem which needs to be more seamless, needs to be more start-up friendly. I believe they should in fact employ some of the upcoming start-ups on such technologies because they understand the problems that start-up founders and employees face and it is important, that someone who’s actually facing the problem comes up with a solution rather than getting a large traditional IT consulting company to help them in such solutions. So, these are my thoughts to support start-ups and I think if we can cover these, it would really help make the whole infrastructure and the entire process of setting up, starting up and getting invested more feasible for more and more young entrepreneurs. The author of the article is the founder, Nextyn. The views expressed are personal  Read all the Latest News , Trending News , Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.