Prashant Desai is a CA and a CWA. Since 1995, he has worked (finance and investing) with various entrepreneurs like Kishore Biyani (Future Group), Rakesh Jhunjhunwala (Rare), Jignesh Shah (FT), and now with Sameer Sain (Everstone). He has managed treasury assets of Rs 3000 cr. Desai has also risked investing into almost everything from fixed deposit, corporate deposit, chit fund, gold, real estate, and stocks. He has learnt only by losing money. In his own words, ‘investing cannot be taught, it has to be learnt.’
Q: What is your take on the budget for this financial year? Do you think it caters to an ‘all-round development’ like it claims to do?
PD: As someone who has not missed listening and analyzing the Union Budget since 1995, I must confess, Budget 2021 surprised me, positively and big time. I think it was brilliant. There was only one focus this time, GROWTH. No confusion there. And what is special about the Growth Budget is that it was unexpected. Against all odds. Like the Indian cricket team’s turnaround after 36 all out at Adelaide. Why?
We were coming out off COVID uncertainties. India’s already struggling finances had worsened. Most experts expected the FM to increase either corporate taxes or individual taxes or probably tax the super-wealthy. She didn’t. This required guts and vision. I strongly feel that India will collect more taxes than budgeted through better compliance. Besides, the money not collected through higher taxes should increase consumer spending, and with it demand, and GDP growth.
Secondly, the FM has shown the country’s intent. India will chase growth. India will invest in infrastructure and re-start the cap-ex cycle. And for this, India is prepared. One, it will monetize its assets, IPO of LIC and one general insurance company, PSU Bank privatization and land assets. All the money raised will go towards creating infrastructure. Two, India will not hesitate to borrow (almost Rs 12 lakh crores) to fund further infrastructure growth. Yes, our balance sheet may look stretched, but when the interest rates globally are low and everyone is chasing growth, the FM has put India ‘attractiveness’ at the top of the world. Literally. Padharo mare desh. The message is clear. She has changed the narrative. Not investing in India is a bigger risk.
When there is growth all around, the sentiments improve, the confidence improves. It will enhance entrepreneurship, innovation, creativity, risk-taking, and with it, the elephant will run.
I am thrilled not just for my generation but for my kids too. Yeh naya Bharat hai, I tell them.
Q.There weren’t any changes in the income tax slabs and exemptions. Do you believe there should have been?
PD: Absolutely not. Honestly, no one would have complained if the Hon’ble FM would have raised taxes given the country’s struggling finances. No one would have faulted if India would have lost the Brisbane test. But fortune favors the audacious. It favored Ajinkya Rahane and team India. I am sure it will favor the FM too. My hunch is she will still collect more taxes through better compliance. Remember only 1.5 cr Indian pay taxes.
Q. How can start-ups and new homegrown brands that were affected by the pandemic make the most of this financial year?
PD: Through a change in mindset; by becoming bold. The message is clear. This is a new India chasing growth and will take the risks. Everyone including start-ups now has strong macro tailwinds in their favor. India will grow. Absolutely no doubt about that. Can they take a higher share of this growth? For that, they will need to get bold. I would suggest them that raise larger capital and then get aggressive. Its time. Don’t look back. Just focus ahead. Invest in talent. But be brave. Like Shubhman Gill, Mohammed Siraj, Natrajan, Shardul Thakur, Hanuma Vihari, and Washington Sundar, just grab this new opportunity by the horn.
Q.Do you think this budget espouses the idea of ‘Atmanirbhar Bharat’? Is this the right direction for us?
PD: In my view it certainly does. Political leadership has played its role to perfection. One, they have provided the macro environment with a clear message that the country will chase growth at all costs. Two, they have lifted the country’s sentiments and built momentum. The rest will be for companies and individuals. Like China, if we Indians can gather the courage and build capacities, we will be a credible alternative to China and Vietnam. In 2006 China’s per capita GDP was where India is today ~ USD 2000. In 14-years it touched USD 10,000. This can happen in India too. Multiply this by 136 crores and that is what India can become. Atmanirbhar through Atmavridhi, Vishwas, and Parishram. Jai Hind.