I wish to begin by stating that I speak as an entrepreneur, when I write this piece and is my personal opinion. Before I list my expectations from Union Budget 2021 and what MSMEs need, let me share few Key Lessons from my entrepreneurial journey.
Lesson 0: Financial Planning is key, both to lend money or to deploy where it is necessary for our business. Most entrepreneurs focus on the idea or execution but ignore financial planning. Entrepreneurs tend to attract a lot of stress, if we deploy money, on things which are not really necessary in the immediate future, in anticipation for better tomorrow. Most entrepreneurs make this mistake, it is important to plan for tomorrow, but not deploy money in anticipation for better tomorrow - but deploy money as per present needs.
Lesson 1: Entrepreneurship is about taking risks, and it is not about concept selling. I-live-for-impact generation of today, sees entrepreneurship as an alternative for seeking employment, and few amongst them, consider entrepreneurship as a fall-back option. The So-What of this enterprising belief system is we see many taking the plunge of entrepreneurship, with an idea, and a faint execution plan - only useful to attract attention, and possibly raise a round of money from investors, but lack follow-through. Such efforts fizzle out in the longer run.
Lesson 2: It is a rough terrain, and path less taken - and when you embark on it, you must have perseverance to stick with it for at least 5 years - you will either learn to manage the tight-rope walk, or get used to it.
Lesson 3: When you perform, you will find many suitors, deploying cash and when the tide turns against you, you will be deserted - an able entrepreneur, must plan for such a day. Especially Post-COVID, it is an important trait for an entrepreneur.
Lesson 4: Return on Money deployed must be greater than money borrowed, in notional present value terms. This mantra must form the basis of financial planning, when we borrow or deploy money.
I wish to list three expectations from Union Budget 2021:
Expectation 1: Think about Entrepreneurs - I would like to see our Hon'ble Finance Minister focus on entrepreneurs. When Entrepreneurs perform, jobs are protected and more jobs are created, our tax figures improve and FDI improves, because investors want performers. It has been always investment driven thus far, lets make it entrepreneur driven and see how it pans out. Lets show belief in our citizenry and entrepreneurs amongst us.
Expectation 2: Any scheme or support for MSMEs that the Government wants to work with, lets keep Banks out. The relationship between Banks and MSMEs is always a cause of concern given that the symbiotic relationship is broken, it is important Government uses alternative mechanisms to enable support for MSMEs, rather than Banks.
Expectation 3: One possibility that I wish Government will explore, is waiving the TDS on payments to MSMEs - this is will aid the cash flow. MSMEs may be given this waiver, with a rider, on-time payment of advance tax. This move will ease the cash-flow pressure on MSMEs, and protect jobs, if not, fuel job creation.
