With historic recent developments that triggered a nation-wide surge in IT adoption, Budget 2017-18 promises to be further catalyze the sector. But how far will it go in pushing the economy towards realizing the digital dream?
The Union Budget 2017 will come out on the 1st of February 2017, amidst arguable one of the most uncertain times in economy. A chain of significant events starting from GST have impacted the entire country financially. An evident lack of confidence in the economy, as evident by decrease in investment as was noted based on data till before the historic demonetization, the country fell short of GDP targets for 2016.
However, one certainty that is expected to be reassured with the budget is government’s push for digitization. The government’s mega initiatives of ‘Digital India’, ‘Make in India’, and ‘Startup India’ have already resulted and proliferation of digital devices and given traction to the IT industry. Heavy push on investments in the sector, couple with breakthrough indigenous innovations has enabled the IT industry to become the fastest growing sector in the country. Furthermore, with demonetization turning out to be a boon for the IT industry, cashless transactions and online banking are going to further drive players in the space.
“The Union Budget 2017-18 is likely to be unique as many prime factors like demonetization, GST, cashless economy measures will play a key role.”
Alok Dubey
CFO
Acer India
As the Finance Minister Arun Jaitley rolls out the budget, a hopeful Enterprise IT community sits in anticipation of favorable policies as not just a push but a reassurance of government’s trust and endorsement of information technology. With the entire country to go cashless, the IT industry has a big part to play in the next phase of India’s progress as a digital economy.
Factors that will shape up Budget 2017-18
2016 witnessed a number of announcements by the government aimed at putting India on the path towards a cashless economy. e-Governance and e-payments are expected to be a big theme. The previous two budgets of the Modi Government systematically created frameworks and processes to give traction to initiatives like ‘Startup India’, ‘Digital India’ and ‘Make in India’. The Goods and Services Tax (GST) which is scheduled to be rolled out in July this year will also impact the budget substantially. It is expected that the budget will entail compliance regulations and Standard Operating Procedures (SOPs) for the same.
“Budget 2017-18 is expected to be distinctive as digital currency, GST and demonetization play an integral role in improving the digital infrastructure of the country.”
Harsh Marwah
Country Manager
Verizon Enterprise Solutions
One of BJP government’s primary agendas over the years has been to not just promote business and trade but also significantly improve the ease of doing business in the country. With the surge in startups and the increasing dependencies of businesses across verticals on IT, digitization should be greeted with a number of incentives. The recent slowdown in economy has been tough on investors and an off target GDP assessment resulted in lack of fund infusion into new startups. This resulted in a huge markdown last year. Promoting new businesses and agenda of technology adoption and proliferation is going to be big in this budget.
“It will be important to outline a roadmap for IT manufacturers for implementation of the new GST policy well in time.” –
Rajiv Srivastava
MD
HP India
As Alok Dubey, CFO, Acer India points out, “The Union Budget for the year 2017-18 is likely to be unique as many prime factors like demonetization, GST, cashless economy measures, will play a key role this year.” Rajiv Srivastava, MD, HP India believes this will be crucial in not just promoting digital transition but also driving the IT industry, which carries this mantle of nation-wide digitization. He opines, “The Government’s objective should be to enable this transition from the current taxation system as smooth and orderly as possible — both for itself and for businesses and consumers. It will be important to outline a roadmap for IT manufacturers for the implementation of the new GST policy well in time.”
Emergence of an IT enabled economy
The Modi-led BJP government has been playing on the Digital trump card for over two years. There have been a number of landmark announcements that would signal this intent. The centralization of taxes, increasing dependence on e-Governance, incentives and benefits to IT industry and the growing startup landscape are all examples of an India gradually going digital. Last year’s budget did much to narrow this technology gap between urban and rural India. This year’s budget is set to take technology adoption in the country to unprecedented levels. Anil Valluri, President, NetApp India & SAARC comments, “With the recent move of demonetization trying to shift our cash driven economy of 1.2 billion people and getting them to leap frog to the digital world is unprecedented in history. This is a significant leap towards becoming a digital economy and the budget now needs to focus on how digital can become entrenched and become a way of life, while continuing to focus on growth and providing adequate support to the various pillars of each program so that the economy is on a sustained growth path.”
“The Govt. has to look at implementing policies that are not just great ideas but also have great impact, whether it’s for boosting local R&D, or for unifying the country through standard GST.”
Debjani Ghosh
Vice President, Sales and Marketing Group
Managing Director – South Asia, Intel
This idea is further explained by Vivekanand Venugopal, Vice President & General Manager, Hitachi Data Systems, India who says, “The Government’s effort GST is a definitive step towards accelerating digitalization. The policies and measures taken by the Government should help bring in economic stability, investment-friendly policies, increase ease-of-doing-business, improve long-term tax incentives, along with timely deal-closures and project clearances.” Budget 2017 should have written digital all over it. Vinaya Varma, CEO of mjunction, a JV between Tata Steel and SAIL adds, “I look forward to a budget which carries forward the Prime Minister’s vision of a Digital India in the truest sense of the term and implementation in letter and spirit of the Startup India program. This will boost innovative thinking and fresh ideas so crucial for India’s economy now.” Tenon Facility Management and Security Group Chairman, Major Manjit Rajain sums it up in a single line, “The forthcoming Union Budget is expected to unveil reform-centric policies and an action plan that would help boost the growth.”
