Union Budget 2019 evokes mixed reaction from ad industry heads
Industry experts say the ease of business proposed in the Budget has been encouraging but there is a need for substantial reform measures
Finance Minister Nirmala Sitharaman in the first Union Budget for Modi Government 2.0 laid down the blueprint to turn the Indian economy into a $5 trillion economy in the next five years. There were also some major announcements for the media and entertainment sector.
We asked advertising industry experts about their views on the Union Budget announcement and how the industry would benefit from the same.
Edited excerpts below:
Ashish Bhasin, CEO, Greater South, Dentsu Aegis Network and Chairman & CEO India
The government’s decision to examine the opening up of foreign direct investment (FDI) in media, is beneficial for the sector. However, some of the actions of the government do seem contradictory and a letdown. The expectations from a government coming with such a majority was that they would undertake substantial reforms, stimulate growth and cut tax rates. However, they have missed the opportunity to do so and have acted contradictorily by implementing surcharge on HNI individuals. Despite everything, I expect the next 10 years to be very bright for India.
Raghu Bhat, Founder & Copywriter, Scarecrow M&C Saatchi
More private investments and product launches will help the ad industry. Also, the consumer has to see income growth and feel bullish about the future. Struggling sectors like the four-wheeler and aviation industry need to be revived. If the above things happen, the ad industry will benefit. I see this budget as step 1 of the revival. Financial services is an important category for us and we are happy to see steps taken to improve liquidity.
Ashish Patkar, Founder and CEO, Monk Media Network
The advent of mobile phones has ensured that more and more people are accessing content - both entertaining and informational. The need of the hour is to ensure the content supply matches the consumption demand. The FDI limit increase will allow companies to robustly invest in content creation which will take us towards a content-rich economy.
Sameer Makani, Co-Founder and Managing Director, Makani Creatives
The policy changes and developments announced in the Union Budget will definitely bolster innovation and growth. The advertising and digital industry needs an additional skilled workforce. The proposal to train 10 million personnel in industry for relevant skills like AI, IoT and Big Data is a welcome move. This investment will result in creating jobs and also boost long-term growth for the digital industry. Also, the overall economic development and ease of business proposed will encourage Indian and international companies to invest more in allied functions like advertising and promotions. This will have a positive impact on our sector and is likely to generate more growth and business.
Hareesh Tibrewala, Joint CEO, Mirum India
In the budget, the government has proposed an increase in FDI in the media industry and in AVGC (Animation, Visual Effects, Gaming, and Comics) sector. India is an attractive and emerging market from a media and media services perspective. We also have a robust talent pool in animation, gaming, and visual graphics. Also media consumption in India is increasing. Thus, an increase in FDI should see more global players enter the Indian market. This augurs well for this sector. Overall, the budget does not have any big or bold headlines. One sees a sense of caution. The government has stayed away from any big populist measures. There are minor reliefs in the form of a decrease in corporate tax for companies with a turnover between Rs 250 crore to Rs 400 crore and increase in tax exemption on interest paid towards housing loan. And minor increases in the form of super-rich tax and cess on petrol and diesel. One senses that the government’s key priority right now is to fix the financial services sector and strengthen the basic economic framework.
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