The Interim Budget for 2019-20 focuses heavily on the rural sector and the middle class and should boost consumption. To reduce tax burden for middle-class taxpayers and recognizing their contribution to the economy, the government announced the full tax rebate for income up to 6.5 lakh (including investment under 80C). This will aid in increasing the disposable income for the consumers, thereby positively affecting consumer sentiments.
We foresee a rise in demand for the mass segment of consumer durable goods as a result.
Rural electrification under ‘Saubhagya Yojna’, which aims to touch every household by March 2019, clubbed with infrastructural push via Gram Sadak Yojana and rural support schemes, will serve as a catalyst in improving the demand for consumer electronics and appliances. ‘PM Kisan Samman Nidhi’ programme, which provisions direct income support for farmers benefitting over 12 crore families, coupled with an increase in the rural employment guarantee programme allocation by `5,000 crore and other interest subvention measures, will aid in rural demand generation. Category penetration levels should, therefore, improve faster, particularly for refrigerators, washing machines and TVs.
Government’s continued attention towards skilling the youth under ‘PM Kaushal Vikas Yojana’ will help improve the quality and quantity of skilled labor, which is critical to industrial growth. The addition of IC skilled workforce will aid industry as a whole. Under Godrej’s Disha Programme, we run Godrej Vocational Training Schools for imparting technical skills on AC, refrigerator and washing machine servicing.
We also welcome the government’s attention to climate change and clean energy. We are committed towards the success of the energy efficiency regime. At Godrej, the environment is a core value and guides our products as well as manufacturing processes. With the least Global Warming Potential, we have a completely green AC portfolio. We have been endeavoring to bring about a pro-environment shift amongst consumers.
The FM also talked about the vision of making India a USD 5 trillion economy in the next five years and a $10 trillion economy in the eight years thereafter. We welcome this ambition and would like to affirm that electronics, appliances and Artificial Intelligence industries will serve as major growth drivers in the achievement of this.―New Indian Express