Top Takeaways From The Interim Budget 2024 For The M&E Sector

Although an interim budget, it presented a brilliant opportunity for the government to demonstrate its ambitious plans just before the next general elections. Having set the stage for India's transformation into a 'Viksit Bharat' by 2047, the budget remained rational and aligned with the ongoing initiatives. 

While industry experts hail the overall Indian economy, the media and entertainment (M&E) sector, per se, has not been able to drive big numbers or meaningful conversations in the past. This year's interim budget too, only signalled a circumlocutory impact on the sector. However, it did zero in on the areas that heavily contribute to the M&E sector, such as boosting the digital infrastructure, equipping and empowering the youth, extension of tax breaks for startups until March 2025 etc. 

We spoke with industry leaders to learn about their thoughts on the recent interim budget put out.

Shradha Agrawal, founder and CEO, Grapes

The budget allocates considerable attention to the development of modern infrastructure in all its forms—digital, social, and physical—opening up new opportunities for the M&E sector, particularly in the realm of digitalisation.

The government's focus on 'Yuva' and 'Mahila', along with going deeper into the country through the aspirational district program, Udaan, etc. has the potential to boost the M&E sector and generate employment within it. Additionally, the allocation towards low/nil interest rate financing for research and development in the sunrise sectors will allow the incorporation of emerging technologies in the sector.

Sreeram Reddy Vanga, CEO & co-founder, Kofluence

In anticipation of the budget amid an election year, expectations were tempered for the M&E sector, recognising the likelihood of major proposals being deferred to the comprehensive budget scheduled for release in April-May. However, the media and entertainment sector remains buoyant, fueled by government initiatives such as 100 per cent FDI in various segments. Notably, the recognition of the sector's potential is evident in the budget's emphasis on the surge in digital adoption, deeper internet penetration, and increased smartphone accessibility.

Looking ahead to the next five years, we hope the budget introduces incentives for skill development in the M&E industry, emphasising regional content and empowering creators across diverse mediums. Expectations also include a surge in data privacy and security regulations this year. With the sector's transformative potential high, we eagerly anticipate continued collaboration with the government to drive innovation, foster growth, and enhance global competitiveness.

Hariom Seth, Founder, Tagglabs

The recently announced union budget, with its provision of a 1 lakh crore rupees interest-free loan, opens up unprecedented opportunities for innovation in the entertainment sector. This funding can be utilised to develop AI tools that can streamline processes in the content creation industry. AI tools, which were previously considered heavy on investment, can now be explored more freely. This is a game-changer, as it not only encourages technological advancement in the entertainment industry but also fosters a culture of innovation and creativity. The budget, therefore, is not just a financial plan, but a catalyst for change in the industry, paving the way for a new era of content creation powered by AI.

Delphin Varghese, co-Founder, AdCounty Media

This budget stands out as a positive step for India's ever-growing advertising and marketing sector. The advertising sector in India has a market worth of $14 billion (INR 1099 billion) in 2024. This industry is poised to grow by 21 per cent in 2024 with digital media being the major driver. Fostering the digital economy and driving transformation remains a paramount priority, with a dedicated emphasis on exploring new frontiers of innovation such as artificial intelligence and machine learning alongside upskilling the youth under initiatives like Skill India Mission that have upskilled 1.4 cr youth so far.

Shreyans Hirawat, Director, NH Studioz

Following the interim budget, the Indian entertainment industry is poised for a transformative leap, especially with the budget's focus on enhancing digital infrastructure and economic upliftment. The substantial Rs 1 lakh crore allocation for R&D in technology, targeted towards the youth, is particularly encouraging. This investment is expected to spur innovation in AI and related tech, vital for the future of digital content creation and distribution. We appreciate the government's recognition of digital platforms' potential and are enthusiastic about leveraging these developments. The M&E sector, as a catalyst for cultural expression and economic growth, is ready to embrace these progressive changes and the wave of creativity they promise to usher in.

Sundееp Rana, co-Foundеr, NеtSеtGo

The interim budget provides hope for the advertising and marketing business. With the economy expected to grow at a solid pace of 6-6.8 per cent next fiscal year, advertising spending is anticipated to rise across industries.

However, I would have liked to see more direct incentives or policies aimed at further strengthening the ad industry. For example, tax benefits for digital advertising spends or lowering GST rates on creative and media services could have provided a boost.

That said, the overall growth-oriented approach, with a likely rise in consumption on the back of income tax tweaks and infrastructure boosts, should translate into more marketing budgets. Sectors like retail, consumer durables, ecommerce etc. where ads play a key role, are expected to see continued expansion.

I believe digital advertising will be a key beneficiary, given the rapid internet penetration. As more tier 2/3 audiences come online, digital ad options beyond traditional media will open up. So while not a budget directly focused on advertising, the implied backdrop of continued economic growth provides room for advertising and marketing to flourish across media platforms - be it print, TV, digital or out-of-home.

Prof. Gangaraju Saladi, Faculty of Film & Television Management, FLAME University

Since this was an interim budget with general elections expected to take place later this year, the M&E sector's key expectations from the upcoming Union Budget shall be:

--Acknowledge the M&E sector as an influence and soft brand-building sector by granting it infrastructure status for facilitating easier access to financial credits and tax incentives

--Tax breaks or holidays for gaming start-ups to boost the production of Indian IP and attract investments

--Rationalising high GST rates on live entertainment and theatre tickets

--Accelerate the work on Model Theatre Policy and Single Window Portal for opening theatres

--While the tax authority has already come out with a uniform 28 per cent GST applicability on games of skill and games of chance, we need to take the stakeholder perspective once more and address their concerns. The Indian gaming industry was well on its way to becoming a global force in this space till the GST rate seems to have underwhelmed the expectations here

Bhavesh Talreja, Founder and CEO, Globale Media

The budget's focus on modern infrastructure development, covering digital, social, and physical aspects, opens new opportunities for the media and entertainment sector, especially in digitalisation. This budget not only propels a tech-driven economy but also heralds a golden era for companies operating at the intersection of AI and market technology. 

Ambika Sharma, Founder and 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 the 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 budget'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.

Yousuf Rangoonwala, Founder, Kakkoii Entertainment

It’s a classic Lok Sabha election year budget. But if the government does what it has promised, after nearly a decade, the focus will return to development beyond the metros and top 25 tier 1 cities with the government’s emphasis on 'garib, yuva, mahila aur kisaan'. This is positive news for FMCG (it had a troubling 2023) and other categories with mass brands (priced below Rs 25) and, hence, large agencies dealing with such brands. This implies rural and semi-urban marketing will become important, again. We expected tourism and hospitality brands to get into turbo mode this year. So, it’s good news the govt wants to support their growth too.

Kunal Lakhara, CFO, Pocket Aces

As the FM highlighted, the Skill India Mission's achievements are a testament to our nation's commitment to nurturing talent and fostering growth. The training of 1.4 crore youth, along with the upskilling and re-skilling of 54 lakh individuals, demonstrates a profound investment in our human capital. 

In our dynamic landscape of media and entertainment, these advancements herald a wave of talent and innovation. As we harness the potential of our skilled workforce and cutting-edge educational institutions, we pave the way for a vibrant and thriving entertainment sector that mirrors the aspirations of our evolving society.