Big Story: India Inc to Expect better Results in 2021
The sudden outburst of the Covid-19 pandemic upturned the entire situation of India Inc. Businesses, banks, government polies, and almost everything in the India Inc. got impacted. The advent of 2021 is likely to bring in positive changes and relax the crisis in Indian Inc.
![](blogImages/WFa5ganeTn.jpeg)
The massive wave of the COVID-19 pandemic has altered the entire economic panorama of India. It is indeed challenging to beat the impact that the pandemic has made on India Inc. It seems that all huge things are to dominate and be at the forefront in the Indian economic rivalry. Does this mean only big pockets and big brands will have an edge in 2021?
Panorama of the Indian Banking Sector
According to the Reserve Bank of India (RBI), India's banking sector is adequately capitalized and well-managed. Uday Kotak, the president of Confederation of Indian Industry (CII) revealed at a recent customary pre-budget meeting that budget proposals must concentrate on growth as well as economic management from a 3-year viewpoint. Aggressive disinvestment and monetization of assets can increase government's revenues in the period when tax revenues have collapsed. He further added that the government must pull down its stake to below 50% in public sector banks (PSBs) in the coming year, except for few giant PSBs like Bank of Baroda, State Bank of India, and Union Bank.
Moreover, increase in spending on infrastructure, rapid execution of projects, and continuance of developments are likely to offer enhanced boost to the growth of the banking sector. All these factors clearly reveal that India’s banking sector is on the verge of a robust growth as swiftly developing businesses will turn to banks for their credit requirements.
Furthermore, the technological advancements have brought mobile and internet banking services to the forefront. The banking sector is putting enhanced focus on offering better-quality services to their clients and improving their technological infrastructure to enhance overall customer experience, giving banks a competitive edge.
Indian Corporate sector to Face Rigorous Churn
Former RBI governor, Raghuram Rajan revealed some of the big names such as Anil Ambani’s Reliance Group, Videocon, DHFL, and Jet Airways in India Inc. Urjit Patel, the successor of Raghuram Rajan, requested banks to take actions against these biggies that used to lead India Inc and bankruptcy courts pushed them out of the reckoning. This is a clear indication that ’20s will experience the downgrading of many big businesses to the background. Apart from this, India’s top Indian Philanthropist Businessmen Ajay Piramaal, Gautam Adani, Vedanta’s Anil Agarwal are likely to be the conquerors for 2021.
Novel Wage Rule Might Increase India Inc's Costs
Thanks to the Indian government’s novel wage rules, which are part of the Code on Wages approved by Parliament last year. From April 2021, after the commencement of this rule, provident fund (PF), salary slips, and gratuity components, take-home salary, and even balance sheets of India Inc will be affected. According to the new rules, the allowance component cannot surpass 50% of the total salary or compensation and this means that basic salary has to be 50%. In agreement with this, companies will have to surge the basic pay component of wages, which will lead to a relative rise in gratuity salaries and employees' contribution to the PF.
India Inc Withstands Performance Gains
As per a survey carried out by industry lobby Ficci and Dhruva Advisors, India Inc recorded continuous development in capacity utilization and sales in December 2020, however high managing expenses and weak demand still continues to be a tender point for companies even in 2021.
The recovery of the economy and execution of a broad set of polies under the Atmanirbhar Bharat package have resulted in an incessant development in the performance of big business. Results of this survey also revealed that members of India Inc are expecting even better results in 2021 as the Covid-19 vaccine is on the verge of approval.
According to the stats obtained from this survey, nearly 74% of the survey contributors believe to have a noteworthy, positive impact on their businesses once the vaccine becomes accessible. Also, 70% of businesses stated that the shift in global supply chains from China has proven advantageous for India. 40% of businesses are at present functioning at capacity utilization level of over 70% and 64% of businesses stated that they will make use of a combination of travel and virtual meetings even after the COVID-19 crisis situation relaxes.
What will 2021 Bring in for India Inc?
A decline in the rate of personal income tax, reasonable import tariffs, elimination of minimum alternate tax, banking licenses for businesses, decrease in government holding in public sector banks, and a warlike disinvestment programme will offer support in boosting the growth of India Inc's wish list for budget 2021.
The situation of Indian businesses will recover as economic activities will augment with an accelerated pace post-lockdown and wages will grow on the back of extensive demand recovery across industries. Many businesses' revenues will grow as demand begins to rise following a sharp collapse, and economically powerful businesses will sustain good access to funding, but speculative-grade issuers are likely to face hurdles. In short, the advent of 2021 is sure to bring in many positive changes in India Inc.
![](https://www.researchdive.com/blogbannerImages/I13xdE2xZQ.jpeg)
How is Cybersecurity Becoming a Vital Measure to Combat Emerging Threats in the Banking Sector Globally?
April 08, 2024![](https://www.researchdive.com/blogbannerImages/4JgLEV4O1E.jpeg)
Wood Pellet Biomass Boilers: An Eco-Friendly Heating Solution
April 08, 2024![](https://www.researchdive.com/blogbannerImages/uiGZyFcdTV.jpeg)
5 Ways Vanilla Oil Can Transform Your Life
April 08, 2024![](https://www.researchdive.com/blogbannerImages/ofaWxy37Xc.jpeg)
Discovering the Magic of Toasted Flour: Why & How to Use It
April 08, 2024