Budget 2024: Industry expectations

But what about the industry?

Ahead of the Budget, Prime Minister Narendra Modi said that the Indian economy is growing at 8%.

According to the Confederation of Indian Industry (CII), tax stability is important. In its pre-budget memorandum, the CII said that it appreciates the government’s move to maintain stability in tax rates. It said, “It is suggested that to provide tax certainty for businesses, the corporate tax rates be maintained at the current levels”

Sustainability is another focus. Talking to the Hindustan Times, Dr Miniya Chatterji, founding director of the Anant School for Climate Action, and CEO of Sustain Labs Paris, said that in the Union Budget 2024, it would be important to prioritise initiatives that drive sustainable growth. Investments should focus on renewable energy projects, green infrastructure, and sustainable agriculture.

PrintWeek reached out to industry leaders on their expectations. 

Dhananjay Salunkhe, managing director at Huhtamaki India, said, “The Indian packaging industry plays a significant role in supporting sectors like agriculture, food, and consumer goods. As we look towards the upcoming budget, I see tremendous potential for policies that could drive growth and innovation in our sector. One of the most pressing challenges we face is the recyclability of flexible packaging. While current policies promoting Extended Producer Responsibility (EPR) and recycled content are steps in the right direction, we need a regulatory push for recyclability of mono-material solutions in flexible packaging.”

He added, “Well-crafted legislation can be a powerful catalyst for change. By introducing incentives for sustainable practices, the government can help businesses align with global sustainability standards while benefiting the environment. This approach would not only support the packaging industry but also contribute to India's broader environmental goals. The shift towards circularity would benefit businesses, consumers, and the nation as a whole.”

Ashish Pradhan, president at Siegwerk Asia added that the packaging industry in India is at a pivotal juncture, experiencing rapid growth and innovation. He said, "The robust growth of the packaging sector is supported by the rising demand for FMCG, eCommerce, and sustainable packaging solutions."

He added, “There is a pressing need for policies that support sustainable packaging solutions, infrastructure development, and technological advancements. We expect the upcoming Union Budget to address critical areas that include the simplification of GST and favourable tax policies, which help keep momentum in this sector high. These measures will not only enhance the industry’s global competitiveness but also drive environmental responsibility and economic growth.”

Mihir V Shah, executive director of Vipul Organics, expects a renewed focus on infrastructure development, manufacturing and job creation.

He said, “India aspires to be an export hub with the stated target of exports of goods and services worth USD 2-trillion by 2030. This can be made possible by reducing the tariffs on imports of raw materials and ensuring that the right building blocks are in place, especially for the manufacturing sector. In addition, putting stringent anti-dumping measures will ensure that the domestic manufacturers have a level playing field."

Shah believes that the Budget will ensure that the government’s commitment to the manufacturing sector as a whole and the chemicals sector in particular moves seamlessly.

“Today, chemicals contribute roughly 7% to the GDP and India is the sixth largest producer of chemicals in the world. The chemical sector is estimated to grow to USD 300-bn by 2025 and USD 1-tn by 2040,” he said, adding, “We hope that the budget focuses on bringing PLI in the chemical and petrochemical sector to propel growth, for both existing and greenfield facilities. In addition, the development of quality infrastructure and chemical hubs with centralized waste and effluent treatment systems will bring India to par with the other manufacturing hubs. This will ensure that the sector continues to be an important participant in the India growth story.”

Pankaj Poddar, Group CEO of Cosmo First, said, “India’s flexible packaging industry has substantial export potential which if supported by higher RoDTEP rate (including SEZ units) in upcoming Union Budget 2024 can substantially propel India’s exports. Infrastructure development for waste collection and R&D in recycling are crucial which can be attracted with incentives in the proposed budget. Incentives for innovation and R&D and an interest equalisation scheme for exporters would boost our global competitiveness. These measures would significantly propel our industry's growth, projected to reach USD 204.81-billion by 2025.”

Dr Gita Bajaj, director of Vinsak India, said, “The government has been giving a big boost to the manufacturing sector. There are schemes to promote FDI and entrepreneurship. However, it is important to invest heavily in research & development, if the government wants its manufacturing sector to compete with global tech giants. Public-private partnerships, research grants to MSMEs and SMEs, and research centres for developing new indigenous technology in the packaging machinery industry will help make us competitive and contribute to building Atmanirbhar Bharat.”

Khushboo C Doshi, managing director, Rajoo Engineers wants the Budget to focus on capital expenditure aiming for 25-30% increase as compared to the previous year. 

“Since most of the packaging industry belongs to MSMEs or Micro Enterprises, establish a dedicated vertical in the Ministry of MSME and modify or introduce PLI schemes for this segment,” Doshi appealed to the government.

Doshi also wants the government to address the issue of inverted-duty structure for the manufacture of plastic processing machines and the packaging machinery industry and an increase in export benefits for the plastics processing and packaging machinery sector by 150- 200 base points to compete more effectively in the global market.  

Doshi concluded, “Granting “infrastructure” status to the plastics industry, especially for renewable energy and agriculture sector will effectively contribute to the economic development of the country. Plastic products are used in roads, water supply, irrigation, sanitation, sewerage etc.”

S Sunil Kumar, country President of Henkel India, said, “The manufacturing sector is a key driver to India’s economic growth, contributing to 16-18% of the country’s GDP. The Indian government has played a crucial role through a series of strategic initiatives and policies, such as Make in India and PLI scheme, aimed at enhancing its competitiveness and productivity. To accelerate it further, strategic focus areas suggestions that can be beneficial: making raw materials available at scale locally, competitive tax structures, development of industrial corridors, and investments in research and development. Continued emphasis on improving the ease of doing business, streamlining regulations, and ensuring a stable policy environment will be crucial for attracting long-term investments in the industry.”

He added, “The adoption of Industry 4.0 in manufacturing and sustainable practices is also gaining momentum. Industry 4.0 technologies, such as IoT, AI, and blockchain, are anticipated to receive further support as they mature and add more value, improving operational and supply chain efficiencies. A regulatory and financial framework that incentivizes sustainable practices will significantly boost sustainability across the value chain. Now that we have established a strong growth foundation and good track record, a favourable budget will undoubtedly spur further growth momentum.”