A sector that contributes 8% to India’s GDP and 40% to country’s total exports called for a higher capital ceiling to further strengthen the country’s economic growth and the allocation of 20,000 crore has given SME sector the much needed due from government. With this initiative, SMEs would finally be able to curb the biggest obstacle of lack of availability and high cost of credit. In addition to this, specifying a clear date of GST implementation is expected to give a huge boost to the e-commerce space since GST implementation will ensure single marketplace which will break tax barriers between states, bringing in a uniform tax rate across the country. Overall benefits received by the sector would be sufficient to offset to rise in service tax clause.
As far as start-ups are concerned, allocation of Rs 1000 cr would further promote innovation and amplify country’s economic growth. As a whole, the budget looks very promising for the SME and ecommerce platform.