With Finance Minister Arun Jaitley minutes away from presenting the Union Budget in Parliament on Wednesday, expectations of the technological industry are running high. Here is what key players of the technological field expect from the Union Budget:
Madhur Deora, Chief Financial Officer, Paytm
The Union Budget 2017 is widely expected to encourage digital payments and universal access to financial services. It’s important for our country to create a robust infrastructure to offer high-speed, reliable Internet access to one and all. Improving access to digital services with tax rebates on the production of affordable smartphones and offering subsidized data will also go a long way in democratizing India’s payments sector. We need to focus on digital money to stay digital, by strongly encouraging digital payments of all forms, as compared to ATM machines. Waiving off transaction fees for low-ticket purchases and increased access to credit would also help bring millions of unbanked and under-banked individuals into the folds of the mainstream economy.”
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Atul Rai, CEO and Co-founder, Staqu
I am expecting a stronger push towards the entrepreneurial ecosystem from the budget this year. While last year, the Government of India supported our cause with the Startup India, Standup India initiative, amongst Make in India and Digital India, we need to now tread on the uncovered grounds.
Startups continue to invest their time and effort into sorting several tax-related and regulatory issues, which makes the operations further cumbersome and challenging. By extending the tax-free regiment to 5 years and taxing ESOP (Employee Stock Ownership) at the times of sale, would really give a boost to the startup environment today. Since RnD happens to be a crucial part of our operations I expect government should also consider tax relaxation to those startups which are collaborating with academic institutions for RnD related purposes as it will not only improve the country’s ranking in “global innovation index” but will also produce world-class researchers and companies in India.
OEMs further make up for a crucial leg of our operations. Hence, I expect a reduction in the bureaucratic formalities and tedious procedures for manufacturers. The government should consider streamlining the current processes, in order to let OEMs focus on further disrupting the status quo and bringing newer innovation in the mainstream foray!”
WATCH VIDEO| Budget 2017 Expectations: Taxes
Ambarish Gupta, Founder and CEO of Knowlarity – “Over the past few months, one of the major talking points and a bone of contention between central and state governments is the enigmatic Goods and Services tax, popularly known as GST. While the intricacies of GST are still not crystal clear, it is definitely being supported by numerous businesses as it would enormously reduce the ominous task of estimating and filing their taxes. Also, the government’s hints of the entire value of demonetized notes not finding their way back into the economy will see the forthcoming budget giving a further boost to cashless transactions. The intention is evident in some of the steps such as discounts while using cards at toll booths, waiver of merchant discount rates while using debit cards at POS terminal, etc. which have been implemented although for a limited time period. It would be great to introduce additional benefits for users of cashless transactions through credit cards, debit cards and mobile wallets. Certain benefits should also be announced to promote the usage of payment bank services in the unbanked and under-banked sections of the society,”
Shailaz Nag, COO, PayU India – “The demonetization drive needs to be followed by strong, systematic and organized steps by the government, and we need to rope in users from tier 2, 3 and 4 cities and towns. My only expectation from the Union Budget 2017 is the availability of enough funds dedicated to imparting and increasing knowledge and creating awareness amongst Indian users, both merchants and consumers, on how to pay and accept payments digitally.”
Manavjeet Singh, CEO & Founder, Rubique – “The startup ecosystem in India is flourishing every year. Some startups have seen a phenomenal growth & success towards implementation of their ideas last year. And for further boost to growth of startup economy, the upcoming budget announcement is very crucial. There is expectation towards various kind of exemptions on taxes like the exemption under the minimum alternate tax for startups , tax concessions for the ESOPs, unlisted securities and convertible instruments . Post demonetization, we have witnessed growing traction for technology startups, the government should also recognize their contribution in the digital economy vision of India by considering extra incentives/concessions”
WATCH VIDEO | Budget 2017 Expectations: GST
Abhesh Verma, COO, nexGTv – “I have great expectations from the Union Budget this year. Last year, the Indian Government issued a series of benefits for the startup community, including and yet not limited to Startup India, Standup India initiative, along with Digital India and Make in India. As a result, we see India transforming into a mobile-first economy, with a host of foreign players setting their base for operations in India. Besides, towards the end of the year, Government denouncing INR 500 and 1000 currency notes further pushed the economy towards digital transactions.
In 2017, I expect the government to continue to support and nurture the budding entrepreneurial infrastructure in India. To begin with, the government should consider extending the tax exemptions for startups. This is especially crucial given the state of economy post demonetization and infrastructural changes that are yet to be put in place. Furthermore, the Google tax is going to further increase the costs of operations and hence, the same should be checked, and startups should have enough incentives to grow and expand, without having to necessarily invest their resources in additional levies.
At last, I expect the government to reduce and streamline the taxes charged on e-commerce services and digital goods, such as games, music, and videos consumed online. The same would allow OTT players like NexGTv to grow our consumer base and provide the most simplified services.”
Ranjit Punja, CEO & CO-founder, CreditMantri – “The general consensus is that the 2017 Union Budget will need to factor in the political and economic compulsions brought on by the demonetization initiative. There is widespread expectation that the Budget will usher in welcome changes in personal income tax, as well as corporate tax, and that there will be an easing of the tax rates on all income slabs. We will also probably see incentives that encourage greater adoption of digital payments and a move towards a cashless, or at least less-cash, economy. The NDA governments’s attention to the rural economy will continue with more rural and farmer-friendly development schemes.”
WATCH VIDEO | Budget 2017 Expectations: Sectoral Impact
Satyam Kumar, CEO, Loantap – “This is going to be a very tough balancing act for government. So far middle class has been at the receiving end. Be it de-monetization, fuel prices, various cess and taxes. This segment has been expecting Direct (Income Tax) slab reduction from last two budgets. They also make some equity and real estate investments, which has received the burnt of executive decisions. Naturally, they are awaiting much needed break in tax slabs.On the other hand, there is widespread misery in agrarian community. Farmer suicide, mounting debt, crop losses and price reduction due to restricted goods movement during demonetization. SME sector is struggling to stay afloat as bank credit is at its lowest. And do not forget this is going to be the last budget sans election fervour. So, a very crucial one to watch out for. From sectoral point of view, we wish that tax on services (even under GST) to remain at 14% level, and additions cess and levies should be removed.”
Piyush, CEO & Founder, Rooter – ” 1. Sports Industry budget was just increased by 50.87 cr in 2016 Budget as compared to 384 cr hike in 2015 budget. With the dismal performance of India in Olympics 2016, I really hope government will allocate substantial budget for development of sports, specific to few disciplines where India is likely to get more success.
2. I also believe that India is getting ready to host a lot of International tournaments, starting with FIFA U-17 World Cup in Oct 2017. So a substantial budget allocation to infrastructure development will be key to make more such events happen.
3. I also hope tax-free regime for startups will be extended to 5 years instead of 3 years currently.
4. The new budget should take special measures to upgrade the digital infrastructure in all parts of the country. More emphasis should be given on rural areas where high-speed internet network should connect all the cities, villages and towns altogether with uniformity in speed for the digital platforms to grow given the potential of the market.”
Pankaj Anand, CEO, Jivi Mobiles- He said, “The recent demontization reform by the Government set the ground for a cashless economy. Mobile banking will become imperative for everybody, it will definitely increase the user base. especially low end smartphones will be on high demand and to support the rural population & low income strata, the Govt should give tax holidays on phones less than Rs. 5000. Similar support was offered by Chhattisgarh Govt in recent times.”
1. Dell: Alok Ohrie, President & MD, India Commercial, Dell EMC
“The IT industry has been seeking an extension of the excise duty differential benefit scheme to cover all ITA products including desktops, laptops, telecommunications equipment’s etc. This would mean a zero duty on all inputs for manufacturing of electronic components and parts, including dual use inputs for all ITA-1 items which results in inverted duty scenario. Expected benefits from this would include import substitution, attracting component manufacturers to set up base in the country and the creation of numerous jobs in the IT sector.” – Alok Ohrie, President and Managing Director, India Commercial, Dell EMC
2. OnePlus : Vikas Agarwal, GM, OnePlus India
“After Make in India and demonetisation, the next big disruption is GST. The government has to carefully took measures to remonetize the economy to return to high GDP growth while maintaining cost competitiveness. From policy perspective, the tax structure should be rationalised and land acquisition policies should be simplified to enable local manufacturing at a larger scale.”
3. U2opia Mobile: Sumesh Menon, Co-Founder & MD, U2opia Mobile
“Given that the investment sentiment in market indicates a prolonged winter for startups, the budget this year comes with expectations of increased stimulus for economic growth. As a startup hub, India is currently home to the third largest number of technology driven startups in the world. The previous year witnessed multiple markdowns in the country’s startup ecosystem due to contraction in sizing estimates of the Indian market and, therefore, to propel this forward, a strong focus on digital infrastructure development and push for last mile internet access is key to validating the market for consumer tech. Furthermore, with the increase in cash flow within banks, advanced technological infrastructure will help facilitate seamless transactions and improve the overall banking system as we enter into the new financial year. “ Sumesh Menon, Co-Founder and MD, U2opia Mobile.
4. Sulekha.Com: Satya Prabhakar, Founder & CEO, Sulekha
“To further the cause of digitization and boosting the digital ecosystem, the government should abolish service tax on Internet-related services such as broadband services, internet advertising, food delivery, so on. This will encourage the adoption of the same and also allow for payments to be become digital.”- Satya Prabhakar – Founder & CEO, Sulekha.
5. Dassault Systemes India: Samson Khaou,MD, Dassault Systemes
“India is on a high growth path currently and is meant to focus on improvement in technology infrastructure and evolve as a super power by 2020. We expect the government to pursue the positive momentum for the dynamic and ambitious national projects like Make In India, Smart Cities and Digital India. With the enhanced focus on smart cities, this year we expect the Government to continue with the impetus on infrastructure and manufacturing. Budget 2016 focused more on all-inclusive growth including boosting digital literacy, improved connectivity and access to technology across sectors. We hope to see a continued focus by the government of India in the realms of technological advancements. In the past one year the country has witnessed rise in FDI points to stronger investor interest in India on the back of robust economic growth. Higher inflows suggest that recent government policies, such as efforts to liberalize foreign investment limits in several sectors and the ‘Make in India’ initiative, are bearing fruit. ‘Make in India’ campaign has been a great success and we are looking forward to its positive returns in the upcoming years.
6. FoodPanda: Saurabh Kochhar, CEO, FoodPanda India
“The year 2016 has witnessed one of the boldest economic decision of demonetization by the Government of India. The move has acted as a catalyst in transitioning India from a cash based to a cashless economy with continued impetus on Digital India initiative of the government. There has also been a great shift in the buying habits of the Indian consumer, and the online transactions have witnessed a great surge in the last one year. With robust investments in making the digital landscape more strong and its consequent implication with respect to quality and customer experience, we have observed that consumers are turning more and more to online space for their everyday needs. Food is also not far behind. Consumers are looking at digitization, not just in terms of menus but also for discovering food. The greatly increased use of smartphones, technological innovations and the rising complexity of decision-making due to the proliferation of products and points of sale are key areas of change that have impacted consumer and retail businesses. Food tech industry is touted to be a $50 billion market, growing at 16 per cent YOY. This growth can largely be attributed to the direction that the last year’s budget provided to the ecosystem. Similarly this year, we are looking forward to a growth-oriented budget that addresses the gaps in digitization and sets path for a digital economy where food tech is also an important component.”
7. Shop CJ: Dhruva Chandrie, COO, Shop CJ
“We’re looking forward to measures that will positively impact the overall consumer sentiment and propel their spending trends. While the government has set a goal of creating around 400 Million jobs by 2020, 1 Million people are entering the job market each year. In the given scenario, the Government’s quick implementation of programs to create new jobs will give our economy the much needed boost” says Dhruva Chandrie, COO, Shop CJ.
8. Ixia Technologies: Mr. Murali Ramalingam, Country Manager-Sales India, Ixia Technologies
As we are moving swiftly towards digitization, cyber security has become one of the biggest concerns of enterprises and Government. Minimal IT budgets and lack of skilled resources to combat cyber security threats can ultimately cost organizations millions. The Government needs to allocate sufficient budget, time and focus to strengthening cyber security in parallel with the growing volume of digital transactions that are taking place in the country.
9. Torero Corporation: Mr. Yashovardhan Gupta,CEO, Torero Corporation
“2016 was watershed year for India. The income disclosure scheme, followed by demonetization, has not only reduced the fiscal deficit, but also raised expectations from the Government. The three solid reforms, that many small and medium businesses, and start-ups would be expecting from the government are, A) Rapid implementation, and roll out of GST. The government should pull out a rabbit out of the hat, and actually implement GST from the 1st of April 2017. This major reform, is just the short in the arm, the economy needs. B) The unemployment experienced due to demonetization needs to catered to, and the government needs to invest in large Infrastructure in projects such as the Sagar-mala (a necklace of ports, surrounding India), and an massive increase in road building target to 50km, per day. C) Recognizing a much more inclusive, and tax paying nation, the Corporate Tax rate needs to come down to a more reasonable 25%. No other emerging economy has such as high indirect + direct tax rate, and all SME’s and corporates, are hoping that this is government, which will normalize the obscenely high tax rates, that India has been implementing till now.”
10. Rahul Agarwal, Managing Director & CEO at Lenovo India.
“It will be interesting to see what the Union Budget for the year 2017-18 has in store for us with factors such as demonetization and GST playing a key role this year. There are a lot of expectations for ‘Make in India’ and ‘Digital India’. The budget needs to focus on how digital India is going to be implemented and can become deep rooted , almost a way of life so that it can contribute towards a sustainable economy. A clear roadmap to support “Make in India’ will make the country an attractive destination and will help boost the manufacturing sector and thereby add to the GDP growth rate of the country. The Government should look for special incentives for the component industry to make manufacturing far more sustainable in India. The extension of the duty differential scheme to the PC segment will definitely take India one step closer to making it an export hub. Finally, we hope there is a robust policy to accelerate the utilization of funds allocated to the IT sector so that there is a far-reaching impact of technology where every change at even the micro level will contribute towards actualisation of the larger goal of digitization”