BUDGET 2023-24: Top 10 Areas for Investment in India

Out of a list of about 35 areas from the Budget 2023-24 that offer new opportunities and growth, we have listed TOP 10 sectors that are reco

After the dust has settled on the Budget presented by Honourable Minister of Finance, Mrs Nirmala Sitharaman, it is time now to chart our way forward in the Indian economy as well as positions we can take viewing the world economies wearing India tinted glasses.
Presentation of the Union budget on 1st February of each is an annual exercise in India to make fiscal plan on a federal level covering our financial year that runs from 1stApril to 31st March. The budget of 2023-24 has come at a time when we have any important milestones and events during the next 18 months spanning across 2023 & 2024. Notably the budget has been presented keeping in mind:
  1. The G20 Leadership of Indian during 2023
  2. Russia & Ukraine conflict and the huge inflationary headwinds worldwide.
  3. Upcoming general elections in May 2024
  4. India’s unique position to keep its growth intact at nearly 7% in a world that is going through severe challenges.
The Union budget has been presented with these circumstances in mind and offers many opportunities in multiple sectors. Out of a list of about 35 areas that offers new opportunities and growth, our team has put together the following TOP 10 areas that we recommend for Indian companies to pursue growth over the next 12 months:

Electric Vehicle Business has been given a push with machinery to manufacture Lithium-Ion battery cells have been made 100% duty-free till 31st March 2024.

Following are other related areas that could be considered:
  • Cathode
  • Electrodes
  • Anode
  • Electrolyte
Vehicles, auto-components sub-systems and tyres can be imported for 100% duty-free for testing and certification purpose making product development in automobiles easier and more open.

In addition to automotive segment, following are other sectors that have shown huge growth:
  • Consumer Durables (including Electronics)
  • Aerospace
  • Defence (Arms & Ammunition)
  • Construction Equipment
  • Telecom and Networking products
  • Thermal equipment, which primarily consists of boilers and furnaces
  • Electricity Generation & Transmission Equipment (like Transformers)
  • Steel & steel products like pipes, tubes, casting and forging
Agriculture / Horticulture
could be a focus area well adopted by the government and the eco-system could become further attuned to its growth. We should focus on growth in this sector as the government plans to spend Rs 2,200 Crores (about US$ 275 Million) for disease free & quality planting materials.
  • Organic Fruits & Vegetables
  • Bio Fertilizers & Bio Pesticides
  • Bio Stimulants

American Pecan nuts have been given an exception in a duty cut from 100% to 30%. Imports could bring in gains.
  • Ready to Eat & Ready to Cook products
  • Spices or herbs (blended)
  • Sugar
  • Non-basmati Rice
  • Dry Fruits

Energy Storage Systems – are a very good area to be in & to make investments. Energy storage system with a capacity of 4,000 MWH would be promoted with viability gap funding.
Following are other segments of renewable energy which the government is focusing on:
  • Solar PV Cells (polysilicon) & Module
  • Green Hydrogen
  • Green Ammonia
500 new projects for biogas & waste to energy would be promoted with investments of Rs 10,000 Crores ( US$ 1.25 Billion)

Artificial Intelligence is an area that the Indian government wants to adopt and lead. Three centres of excellence are planned in association with top education institutions. Investment & collaborations in these areas are recommended. 
Other related segments in demand include:
  • Bio Data Analytics
  • Machine Learning
  • Cloud Computing

Investments in any products or services targeted at the Indian railways should make the most amount of sense with the government planning on spending Rs. 240,000 Crores (About US$ 30 Billion)
Huge investment opportunities in the Railway Equipment segment majorly:
  • Locomotives
  • EMUs (Electric Multiple Unit)
  • Brakes

Last Mile connectivity is getting a great push and so infrastructure building for ports, coal, steel, fertilizers & food will bring in investments of about Rs 75,000 Crores ( about US$ 9.5 Billion)
Other related segments in demand & that have potential include:
  • Warehousing
  • Cold Storage
  • Infrastructure – Utility pipelines

Lab growth Diamonds – the budget has pushed for manufacturing lab grown diamonds in India and a duty cut has been effected making this a zero duty item.

Although this is not a sector or an industry, I will vote for all of us to keep an eye on opportunities flowing from these countries into India. With multiple engagements planned and visits of many delegations from the G20 to India, the G20 country list should be high on our expansion plans.
Other Notable
  1. Regional Connectivity – 50 additional airports, heliports, water aerodromes & advanced landing facilities are investable areas in India presently.
  2. Legal Relief for MSME – tax disputes with the government are likely to be resolved with an amnesty scheme that is widely expected.
  3. Vehicle Replacement – Funds for scrapping old vehicles not eligible to ply on the roads have been allocated.
  4. Cooperatives – This is a great time to set up co-operatives for manufacturing as the lower tax rate of 15% would apply to the new co-operatives
  5. The governments millets program is miss in the recommendation since the cycle of benefits could be long & unreliable.

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