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Budget 2015 expected to strengthen Digital India and Make in India initiative

Budget 2015 expected to strengthen Digital India and Make in India initiative The Union Budget is round the corner and the companies are expecting a lot from the new government this time. The government is also under great pressure as they aim to establish a win-win situation for all. The enterprises want a spur in the investment activity and vouches for the overall development of the country. It is also expected that the upcoming budget would initiate policies which would strengthen the Digital India and Make In India initiative of the government.

The IT companies feel that the Digital India initiative of the government will bring new opportunities for IoT which will in turn induce more investments in the sector. Satinder Sohi, India Country Director, Freescale, commented, “In 2015, the consumption of electronics is expected to rise from $6.03 billion in 2011 to $9.7 billion as per Indian Semiconductor Association (ISA). However, domestic manufacturing is predicted to show a downward trend by as much as 6.7%, with the gap being offset by electronics imports resulting in capital outflow. To achieve the exponential growth forecasted, the need of the hour is tangible and specific initiatives to implement the terms outlined in the National Policy on Electronics. In addition, tax exemptions, sops for manufacturing, and R&D grants to arrest the outflow of capital will encourage electronic system design and manufacturing (ESDM) in India.”

Sohi further added, “Internet of Things will be a key driver not only across various verticals like auto, healthcare, telecom etc. but also will help the manufacturing sector. So it will be interesting to see what policies and initiatives the government launches for corporates to adopt IoT. Various studies indicate that by 2020, there will be 50-billion devices connected to internet, creating a $19-trillion industry.”

The corporates also foresee large investments in infrastructure which will lead to creation of various job opportunities.  The SME sector in the country will witness a boost and will turn out to be the top job creators. Kamal Karanth, MD, Kelly Services & OCG India, feels, “In 2015, from a sectorial perspective, we anticipate that there will be large investments in the infrastructure space which will result in the creation of additional jobs, including the Fixed term contract hiring jobs. Investment in the power sector is expected to create jobs in the rural India. With the IT staffing spend slated to increase, we will see that there will be a rise in contractual hiring taking place among technology firms. As SME’s continue to boom in India, they will continue to be one of the top job creators in India.”

Along with the SME, a lot of traction is expected on the e-commerce side. There will be bulk hiring and demand for skilled people will continue to rise. The employment exchanges in educational hubs and industrial clusters will help in a better demand-supply match.  An investment of Rs 760 crores on skill development and entrepreneurship will also bring in thrust in the job market which will further propel economic growth.

The Make In India program of the government garnered a lot of appreciation from various sectors. It is regarded as important move as it will inspire more startups and will generate favorable business for the country. Neeraj Jewalkar, Founder and CEO, Smartur.com, said, “The Make in India initiative is a crucial move to encourage more and more startups and create a business favorable perception for India. It would be a great step if government can consider strengthening primary & secondary education in the country through enhancing digital & technology solutions. Tech startups in this space should be given special incentives to enhance skill development in primary & higher secondary education.”

Suman Reddy, Managing Director, Pegasystems India, also feels “The Make in India is a good initiative by the Prime Minister. Several companies in the IT sector have been making in India since a long time including Pega. The industry is in support of the initiative and is shifting from services led to a product led ecosystem which is commendable. Like I mentioned above, ample support from the government’s end will be key to nurture this trend. Support for the startup ecosystem with incentives, co-working spaces, trainings and mentoring etc will bring in the desired results on this front.”

Various IT companies are also hoping that the government can minimize indirect taxes and does not impose retrospective taxes. Moreover, the government should also avoid double taxation of foreign investors in order to improve the investments in the country. Safir Adeni, TiE Hyderabad Fostering Entrepreneurship Globally President – TiE (The Indus Entrepreneurs) Hyderabad, states, “In order to boost the Start-up ecosystem, we have 4 suggestions for the government. Firstly, it should adopt tax policy framework of countries like Singapore and New Zealand for faster growth of Start-ups. It should also avoid ‘Angel Tax’ which negatively impacts the fund raising activities of Start-ups as they have to dilute more stake to cover the tax amount. Thirdly, there should be a structured disbursement of the incubation fund as a streamlined process. Lastly, Government should review Companies Act to make it simpler and less expensive for Start-ups to maintain compliances.”

The telecom companies are also waiting for some good news from this budget; they have some high hopes form the Make In India campaign of the Modi government. Talking about the expectations of the telecom industry, Debasis Chatterji, CEO, Netxcell Limited, said, “The telecom industry needs to be revived with a Realistic 3G spectrum auction. Finalization of a concrete telecom policy will provide clarity and enable ease of doing business for the industry. Tax benefits and incentives for VAS companies to energize the VAS ecosystem are much needed. The government should now look at boosting the telecom sector with the ‘Make in India’ initiative. Selection of key areas and forming exclusive technology parks for the telecom industry will be a welcome and most necessary initiative. Telecom needs the ecosystem to develop to be able to make in India, hence if government provides incentives to ancillary industries it will boost the sector. Moreover there should be adequate tax rebates to make it more viable for companies to do business in India.”

The corporates are expecting a lot from the government. However, we do understand that it is a difficult task for the government to address different expectations. But, we hope that the government will undertake some bold steps to fulfil the requirement of all the different sectors.

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Heena Gupta

A reader at heart, this girl loves to express through writing. Her ears perk up as soon as she senses any tech molecule in the air. With the ability to use and navigate typical technologies she becomes a complete tech enthusiast. This post graduate in Mass Communication lives in the world of gadgets. Fiction, history and cartoons keep her busy in the free time. Her urge to grow mixed with excellent writing skills forces us to have her as a part of our workforce.

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