Budget presents growth potential for Gulf-based NRI businesses but leaves key concerns unaddressed
The Union Budget 2025, presented on February 1, has sparked mixed reactions among Gulf-based NRI businesses. While tax reliefs and digital infrastructure investments offer promising opportunities, unresolved issues like high GST on advertising services remain a concern, reported pune.news.com.
Key Takeaways from the Budget
- Marketing and Advertising Growth Potential
The government’s focus on increasing disposable income through revised tax structures is expected to boost consumer spending, leading to higher investments in marketing and advertising. Indian brands with a presence in the Gulf are likely to allocate more funds toward regional media and digital platforms. However, the failure to revise the 18% GST on advertising services could be a setback for SMEs and digital-first businesses relying on cross-border marketing.
- Support for Digital Infrastructure and AI Innovation
The budget’s emphasis on AI, 5G expansion, and digital transformation is set to benefit ad tech, fintech, and e-commerce industries in the Gulf. The ₹9,000 crore Credit Guarantee Scheme for MSMEs will support Indian startups looking to expand into the Gulf market, fostering stronger business collaborations.
- Tax Reforms and MSME Benefits
The new tax threshold of ₹12 lakh provides significant relief to middle-income earners, boosting consumer spending. MSMEs will benefit from increased investment limits and a simplified KYC process set to launch in 2025. These initiatives are expected to strengthen India-GCC trade relations, particularly in retail, fintech, and travel sectors.
- Agricultural Reforms and Sustainable Growth
The focus on crop diversification and sustainable farming is expected to benefit the Makhana industry, with the establishment of a dedicated Makhana Board and improved post-harvest storage facilities supporting farmers.
Sector-Specific Highlights
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Tax Reforms: Full exemption on income up to ₹12 lakh, MSME-friendly policies, but no relief on the 18% GST for advertising services
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Digital Transformation: Push for AI, fintech, and e-commerce expansion, strengthening India-Gulf business collaborations
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Industry Growth: Retail, fintech, agriculture, and digital-first businesses set to benefit from infrastructure development and policy support
The Union Budget 2025 presents a balanced approach, offering tax reliefs and digital economy incentives while leaving some gaps in advertising tax policies. For Gulf-based NRI businesses, it paves the way for stronger economic collaborations, digital transformation, and entrepreneurial expansion.
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