Advertising and marketing industry welcomes interim budget 2024-25

Finance Minister Nirmala Sitharaman presented the Interim Budget for 2024-25 in Parliament on Thursday. The budget is focused on digital transformation, startups, social programs, infrastructure, real estate, tourism, and more. The advertising and marketing industry has welcomed the tech-centric budget with an optimistic perspective and is particularly excited about government’s support to MSMEs, women entrepreneurs and the agricultural sector. These measures could lead to improved rural demand and boost startup economy. FM Sitharaman also announced INR 1 lakh crore corpus for research and development push in the country. 

With this optimistic outlook on the budget, the A&M industry expects to see marketing activities to scale, resulting in increased advertising and media expenditures.

We reached out to digital, marketing and media industry to understand how the increased focus on digitalization and technological development can impact the advertising and marketing industry. Here’s what they said: 

Harsha Razdan, CEO, South Asia, dentsu 

I'm pleased to see that the government's budget priorities include simplifying processes through digital empowerment. While we await the full budget, the interim one signals a commitment to nurturing strategic long-term investments and inclusive growth. The investment focus towards Infrastructure, Start-ups, Tourism, Women Empowerment, and Green Energy should stimulate consumption, boosting the economy and advertising expenditure. The budget also heralds a promising era for companies leveraging AI and market technology to drive a technology-driven economy.

The focus on digital connectivity promises fresh avenues for innovation and expansion within the industry. The projected economic growth of 6-6.8% in the next fiscal year will continue to drive consumption and better advertising spending across diverse industries.  However, the Industry was hoping for additional measures to boost rural consumption, and that could dampen advertising spends to an extent.

Swati Nathani, Co-Founder and CBO, Team Pumpkin:

While we wait for the full budget to come out, the interim announcement presents a neutral outlook for A&M industry. On the whole, the budget prioritizes infrastructure development, social initiatives, empowerment of specific demographics, and the growth of micro, small and MSMEs, while encouraging global collaboration for economic growth which might open up new growth opportunities. Growth in several sectors may arise from increased expenditures in infrastructure, which could upsurge the need for marketing and advertising services.

The budget’s tax provisions have implications for consumer spending habits, business drive, and the overall economic health, all of which can impact the A&M industry. Projects like the IMEC (India, Middle East, Europe Economic Corridor) can open new doors for global business partnerships, potentially benefiting companies working on global marketing strategies.

While Budget 2024 recognizes the importance of social programs and MSME support, it does not provide a clear roadmap for India's digital future. As nations worldwide compete to be the leaders in digital innovations, a dedicated allocation to adopt and invest in digital technology, would have placed India among the key players in this industry. A significant investment for the e-commerce industry, Tech driven innovation, cyber security and data privacy, may have offered visible commitment on digital transformation.

Rashid Ahmed, Chief Digital Officer, Infectious Advertising:

While the budget does not have any tax rate changes, either direct or indirect; the focus on technology and infrastructure, and the funding initiatives for R&D, innovation and startups, point towards rapidly expanding the economy across sectors. As a consequence, marketing activities could be expected to scale, resulting in increased advertising and media expenditures.

The aggressive stance towards developing the foundations for a ‘Developed India by 2047’, including skills, empowerment, infrastructure and industrial development, will likely propel economic activity, resulting in increasing consumer spending. With consumption activity, advertising and media expenditures could be expected to increase, benefitting the A&M industry as the year progresses.

The Union Budget’s India First approach, spanning sectors from tourism, industry and even agriculture, will likely increase investments, especially given the tax incentives for startups and investments by sovereign funds. Industrial investments tend to propel marketing initiatives, which may work in favour of the advertising and media industry.

While there is attention to infrastructure, technology, innovation and industrial growth; businesses are often challenged with their marketing efforts, especially during growth phases which are often CAPEX-heavy. Incentives or assistance specifically aimed at marketing and advertising for high-priority sectors, could perhaps further accelerate the budget’s high-growth agenda.

Chaaya Baradhwaaj, Founder - MD, BC Web Wise:

I appreciate the government's recognition of digital integration. While these align with the needs of our dynamic digital advertising industry, I would like to see more tailored incentives for our sector to further accelerate its growth.The budget's emphasis on grassroots digital adoption is promising for digital advertising. The support for the AVCG sector and e-gaming aligns with our forward-looking approach, positioning India globally. In the pursuit of long-term growth, I believe a more explicit allocation or tax benefits for the digital advertising industry could be a strategic move. Customized initiatives and policies promoting innovation and collaboration would be essential for sustaining the growth of our industry. Recognizing the impact of inflation on purchasing power, the government's focus on increasing digital adoption at grassroots is crucial. Allocating budgets for sustainable development, for example incentivising digital marketing for the EV segment, can not only encourage spending on digital advertising but also contribute to a greener, more sustainable future.

As we anticipate increased consumption due to the budget's economic strategy, there's a direct correlation to a higher demand for digital media and entertainment offerings. This translates into potential growth in digital advertising budgets and opportunities for innovation in content creation. With our advertising market poised for substantial growth, Budget 2024 should give a strong push to the digital ecosystem. Infrastructure development and initiatives supporting technological advancements, such as skilling programs and Centres of Excellence in AI, are crucial to creating accessible and affordable opportunities for the digital advertising industry.

Naresh Gupta, Co-founder, Bang in the Middle:

We will have to wait for the elections and the new government to present the full budget. It's good that there are no new taxes and all old benefits will continue.

Ambika Sharma, Founder & MD, Pulp Strategy:

The Union Budget 2024 has presented a groundbreaking roadmap for India's digital transformation, bolstering the IT and internet landscape across the nation and expanding connectivity. This translates to more opportunities for businesses to thrive in the digital realm and captivate audiences with potential for greater outreach. The budget's attention to skilling and training programs for media and entertainment professionals is a game-changer, nurturing a highly skilled workforce that can deliver awe-inspiring content and consumer experiences. Additionally, initiatives such as tourism promotion and rural development have the potential to boost advertising demand. The Union Budget 2024's focus on fostering innovation and entrepreneurship through tax benefits, credit guarantee schemes, and fund launches creates a fertile environment for startups and MSMEs to thrive and make a positive impact in society. The budget also highlights the importance of the media and entertainment industry in promoting India's culture and soft power worldwide, tapping into the power of technology to create immersive experiences, showcase the beauty and diversity of India, and drive meaningful change in society.

Shrenik Gandhi, CEO, White Rivers Media:

Interim Budget 2024 has a very macro purpose; it's not a mega mall discount policy. This is an absolute mature non-appeasement budget. The 6% relief in corporate tax will drive immense consumption benefiting MSMEs and startups, laying the groundwork for sustained economic growth. Initiatives like Aadhaar, UPI, DigiLocker, and a robust digital tech stack have opened unprecedented global avenues for exporting India’s tech prowess. Two aspects that I would like to see being covered in the post-election budget are:

1. Transparent frameworks and user privacy regulations for Artificial Intelligence and 

2. Leverage the talent of 50 lakh micro and macro ‘people of influence’ in the country.

Preety Singh, Co-Founder and Managing Director of Boomlet Group:

In the wake of the recently announced Union budget, the emphasis on empowering women through financial support is a promising stride towards our nation's vision of achieving developed status by 2047. The disbursement of 30 crore loans to women entrepreneurs signals a crucial step in catalysing their economic prowess. The noteworthy 37% surge in female workforce participation in the fiscal year 2022-23 underscores the success of our collective efforts in fostering an inclusive economy. As a woman entrepreneur, I believe that this financial impetus not only propels our businesses but also serves as a beacon for gender equality and socio-economic progress. To ensure that Indian MSMEs compete globally, sustained commitment to the empowerment of women is indispensable. This interim budget continues to pave the way for a future where the entrepreneurial spirit of women becomes a driving force in our nation's journey towards prosperity and development.

Punit Goenka, MD & CEO, ZEE Entertainment Enterprises Ltd:

The Government’s efforts to boost India’s economy through structured policy reforms will accelerate the development of our Nation over the next few years. The steps taken by the Hon'ble Finance Minister to empower the youth by fueling the entrepreneurial spirit and fostering innovation in technology through initiatives like the 1 lakh crore research corpus, creates a golden era for sunrise sectors such as media & entertainment. The combination of youth and technology certainly holds immense potential and can lead to exciting new opportunities for content distribution and monetization, boosting the growth of the M&E sector at large.

Suchana Sarkar, CBO Makani Creatives

The union budget has paved a visionary path, calling upon the tech-savvy youth to lead India's growth journey. With a focus on transformative technology and digital revolution, we are expecting a new lease of innovation from Digital India. This vision propels the marketing and advertising industry as well to fortify our excellence in integrating technology into our solutions and catering to the new India.