Finance Minister Nirmala Sitharaman presented the Budget 2020 on Feb 1, 2020. She said, “I am mindful of presenting this budget 2020 in the backdrop of the proliferation of technologies such as Machine Learning (ML), Artificial Intelligence (AI), analytics, robotics automation, and bioinformatics“. She stated this budget is prepared around three notable points.
- Aspirational India
- Economic development
- Caring Nation
Let’s see, IT, Tech, and financial industry leaders reaction on union budget 2020.
KT Prasad, Country Sales Director at Zendesk India
“I believe the Union Budget 2020 will have a positive impact on helping further drive Indian businesses, given the current local and international market conditions. The startup sector will benefit greatly from the tax breaks, and the move to tax ESOPs on liquidation will encourage the retention of talent in the sector, poising it for continued growth on the global stage. We are happy to see the push for adopting AI and ML particularly in the healthcare sector, which will help boost access to services as well as quality of care for more people, and further infuse growth in the economy. It is also interesting to see that the government has invested Rs. 8000 crore to the National Mission on Quantum Technologies, which will ensure India remains a key global technology player. This move aligns and propels India into the future with an eye on data, communications, cybersecurity, and technology, and from Zendesk’s position as a global Saas company, this is particularly encouraging.”
Parimal Heda – Chief Investment Officer at Digit Insurance
“The focus on enabling growth for MSMEs in today’s Union Budget 2020 is encouraging. Enabling NBFCs to extend invoice financing to MSMEs through TReDS, should enhance opportunity to fuel the Indian economy and widen the acceptability and trust by the BFSI sector. The extension of GEM e-marketplace as a unified procurement channel should bring more vendors (from the current 3.2 lac) onto the platform. Additionally, amendments to Factor Regulation Act 2011 should boost the MSME sector. On the Debt Recovery side for lenders, the allowance to smallers NBFCs to approach the DRT for smaller ticket size loans, would be beneficial in lowering NPAs & improving the asset quality. However, we expected to hear more clarity on the scheme to provide subordinate debt to be provided by banks for entrepreneurs of MSMEs since less than 15 % of the 50+ million Indian Small businesses have access to formal credit and there is a debt financing gap of the SME is over $1 Trillion.
By allowing data centre parks in the country, the government has set a positive sentiment for the industry. While this will allow better infrastructure in storing and dissemination of data, we were expecting the government to touch upon incentives for setting up data centres which will allow Fintechs to scale faster at an economical cost. This coupled with the extension of Bharat Net (FTH) to 1 lac gram panchayats would add a significant boost to the Digital push in the country.
Given that several steps have been taken in the past to drive the Corporate Bond market in India, the increase of FPI limits from 9% to 15% is a positive push to increase international participation in high quality borrowers via the debt route. This coupled with easy access to credit from banks & NBFCs should bring down credit costs in the medium term.
For start-ups, considering the fact that in the initial years, one may not have adequate profit to avail this deduction, extension to avail the claim of deduction from the 7 years to 10 years is a breather. Deferral of tax on ESOP plans for start-ups should also help bring quality corporate talent to this industry”.
Vikas Garg, Deputy CFO at Paytm
“We see this budget as a good step in direction to become a $5 trillion dollars economy. As a technology player embedded in India’s technology ecosystem, we welcome the government’s vision to build Data Centre Parks in the country. The government’s focus on enhanced digital connectivity, and focus on emerging technologies such as machine learning and artificial intelligence, along with the allocation towards quantum computing are sure to provide a fillip to India’s economy.”
Diwakar Nigam, Managing Director at Newgen Software
“The budget has laid emphasis on the development of skills and technologies in analytics, IoT, AI, and robotics, fostering innovation and competitiveness. The proposal to set up data center parks in collaboration with the private sector can potentially enhance the digital infrastructure of the country and address privacy/security related issues. The government has increased the outlay for digital India programmes, which is encouraging.
We were expecting the sunset clause of the IT act of SEZs to be extended that would have further boosted the IT software exports. However, the provision has not been changed. It would also have been great to have streamlined SEZ processes and labour laws in the IT sector. Removal of the dividend distribution tax is a great move towards a globally accepted regime of shareholder taxability for dividends.”
Ritesh Gandotra, Director at Xerox Business Services
“If this budget had to be known for one thing, it would be the length and breadth of technology infusion across all aspects. Technology and data are changing the world and the latest Union Budget rightly makes these its mainstay. The focus on data, digital records, connectivity and data security across key citizen services underlines the government’s faith in technology to deliver better governance, a safer society and a more competitive economy. The proposals for building data centre parks and setting up the ambitious National Mission of Quantum Technology and Application are significant announcements to put the technology intent into practice.”
Keshab Panda CEO & MD at L&T Technology Services
“From a perspective of the engineering and technology services industry that thrives on innovation, the government’s move to re-revitalize the IP filing and protection process is a welcome step. Additionally the thrust on quantum computing as a key focus promises to further consolidate India’s position in the global digital transformation landscape. The announcement of proposal to set-up Data Centers is also a step in the right direction in terms of acknowledging the importance of data and data analytics.
Overall, the budget puts the role of technology in limelight spanning across all the three focus areas as announced by the government namely aspirational India, economic development and a caring society.”
Prashant Solomon, MD, Chintels India and Hon. Treasurer for CREDAI NCR
“With the lowering of personal income tax, the middle-class and millennials will have more disposable income, thereby spurring spending and growth in the economy which will in turn also reflect in residential purchases. Affordable housing segment has also got a boost with the Hon’ble FM proposing to extend the tax holiday by one more year. However, the Budget leaves much to be desired for the real estate segment with no reduction in interest rates on home loans, no incentives for other segments beyond affordable housing, no announcements on single window clearance and industry status for the sector”.
Takayuki Inaba, Managing Director at NEC Technologies India
“The current budget 2020 proposals exhibit a determined approach of government to make India ready for new technologies. Rs.6000 crore allocation for the proliferation of technology to the lowest level of society by connecting 1 lakh gram panchayats through Fibre to Home connections for supporting basic social infrastructure is a welcome step. The vision of providing panchayat level public institutions with digital connectivity will help streamline the integrated development work and open big opportunities for several stakeholders in the country.
Proposal to develop Data Center Parks throughout the country is another major step towards digitization and capitalizing data resource available with government agencies. This step will help analyze the data better and make a well informed decision regarding resource allocation for social development of a specific geography and demography. Allocation of Rs.8000 crore over 5 years for National Mission on Quantum Technology is another positive step towards taking the country to the digital era. All these efforts will promote the use of technology and digitization and play an important role in the overall development of the economy.”
Rajiv Bhalla, Managing Director at Barco India
“The 2020 Budget has been drafted around the key themes of talent, technology, entrepreneurship and sustainability and we applaud the Centre’s efforts at boosting the economy. The Hon’ble Finance Minister has maintained focus on tourism by announcing that iconic destinations will be connected by “corporate” trains like Tejas and with the plan to develop 5 archaeological sites into iconic sites. Five new smart cities have also been proposed and Barco looks forward to partnering with the Government in this direction.”
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Sharad Malhotra, President – Automotive Refinishes and Wood Coatings at Nippon Paint India
“We find Union Budget 2020 to be a reasonable one with strong measures and good intent. Tax benefit for the middle class makes life easier for the common man and leaves more money in the hands of the consumer. Decriminalization in the Companies Act is a major positive that Corporate India will welcome. No reduction in GST rate for vehicles is a dampener for us.”
Haruto Iwata, Managing Director at Fujifilm India
“We congratulate the government on presenting the Union Budget 2020 for the common man and it’s encouraging to see that the government has taken the lead to deliver on its promise of excellence in healthcare. The government’s “TB Harega, Desh Jeetega” initiative to eradicate tuberculosis by 2025 is a significant step towards building a healthy Society.
India being the highest recorder of TB cases in the world makes it imperative for us to understand the high risk of catching the disease. The government’s vision aligns with our mission to raise consciousness and promote advanced diagnosis and treatment of tuberculosis among patients. Additionally, the government’s impetus on boosting the domestic manufacturing of electronics and medical devices in the country will reinforce the commitment towards raising awareness for early detection in India.
Apart from this, the announcement to boost Artificial Intelligence is a great step to strengthen the usage of technology in the field of healthcare while intensifying the quality with accessibility and affordability. We believe that the government has put forward a progressive budget with a strong vision to take India’s social, economic and overall well-being to greater heights.”
Sanjay Gupta, Vice President and India Country Manager at NXP Semiconductors
“The Union Budget 2020 takes a pragmatic approach to spur sustainable growth by maintaining focus on core aspects of the economy. It’s a progressive budget that lays thrust on the sectors which will enable India’s economic growth.
We are excited to know that the government aims to make India a manufacturing destination for mobile phones, electronic components and semiconductors and keenly look forward to a detailed policy for the sector as it can pave the path towards making India a major semiconductor hub in the coming times.
We also welcome the budget allocation of Rs. 8000 crores for quantum computing, that can open up a lot of new opportunities and commercial applications in the future. The government’s focus on new-age technologies like Data analytics, IoT and AI and improvement of digital connectivity can help the country achieve its goal of becoming a $5 trillion economy by 2025. Extensive use of these technologies will enable stakeholders across tiers to make faster and more evidence-backed decisions leading to business growth”
Suganthi Shivkumar, Managing Director, ASEAN, India & Korea at Qlik
“We appreciate the government’s decision in the 2020 Budget to dedicate the necessary funds and resources towards developing revolutionary and breakthrough technologies such as ML, robotics and AI to further the skills that will prepare us for the next wave and accelerate India’s journey towards becoming a digital giant. With data equated as the new oil, the government’s plan of building cutting-edge data parks across the country is equally important. Furthermore, the governments initiative of allocating Rs 6000 crores to enable unabridged digital connectivity in over 100,000 Gram Panchayats through the Fiber to Home BharatNet scheme holds brilliant potential in securing India’s passage towards achieving tech-empowerment for the remote sector.”
Rahul Sharma, MD-India at LogMeIn
“Budget 2020 looks very promising. We are particularly enthused about the FM’s announcement of seamless delivery of digital services as part of the next wave of digital revolution. AI, ML, Analytics, IoT, Robotics are making giant inroads in India, as was observed in the budget. The policy being introduced to build data centre parks throughout the country will help enhance the digital infrastructure to a significant extent. We are looking forward to the next phase of Digital India which will be a big growth driver for businesses and individuals alike.”
Rakesh Kharwal, Managing Director, India/South Asia & ASEAN at Cyberbit
“The government has highlighted the role of digital technologies like analytics, IoT, AI, and quantum technology during this Budget 2020 Session. The burgeoning digital infrastructure of India needs a strong cybersecurity framework to support it. Now, since it has allocated Rs. 99,300 crores to the education sector and Rs. 3,000 crores for skill development itself, a good way to realize India’s digital vision could be by working on the cybersecurity front from the very beginning. The government may want to cover its tech initiatives with avant-garde simulation-based cybersecurity training platforms like Cyber Range for proposed cyber forensic university and Skill India campaign. This will help India in generating millions of jobs for the youth and also strengthening national security”
Mike Chen, Managing Director India at TCL
“At TCL, we believe that the Finance Minister has announced an encouraging Union Budget 2020. Proposing the scheme to encourage the manufacturing of mobile phones, semiconductor packaging and electronic equipment is a welcomed move and we look forward to a complete policy and leveraging the same to kickstart the domestic manufacturing through our panel factory in Tirupati. Furthermore, painting a futuristic picture in this year’s budget announcement, the FM also acknowledged advanced technologies like IoT, AI, and analytics changing the world. At TCL, we are forever committed to advancing our ‘AI x IoT’ ecosystem in India and will continue to invest in cutting-edge technologies to offer the best services to our customers in India.”
Joint Managing Director and Chief Technology Officer, Quick Heal
“For cyber forensics University – One major step announced by the FM involved the proposal for establishing a national forensic university and cyber forensic university. With cyber crimes increasing at a rapid rate, the need for cyber forensics has become more important than ever for a rapidly digitising country like India. The setting up of a cyber forensics university is a welcome move from the Government. This will definitely help in improving India’s expertise to solve complex cybercrimes.”
Nishant Pitti, Co-Founder & CEO at EaseMyTrip
In tune with the present government vision to encourage Indian travellers to travel more and contribute towards the nation’s growth, this budget takes it a step ahead. The budget has focused on promoting tourism & travel with an overall budget of Rs. 2500 crores in year 2020-21. Government aims to develop 100 more domestic airports under the UDAN scheme.
To promote travel via railways, government will focus on more Tejas type trains that will connect tourist destinations in India.
The Finance Minister has also laid stress on the development of archaeological sites into iconic sites with on-site museums. Five such sites are- Rakhigarhi, Hastinapur, Shivsagar, Dholavira and Adichanallur. Government has also announced renovation of 4 key museums. Rs,150 crore have been allocated for the ministry of culture in 2020-21.
Yashash Agarwal, CEO at Gamezop
“FM’s proposal of delaying tax collection on the exercise of ESOPs is a welcome move. The current structure looks to collect taxes too early causing employees to not exercise vested shares. Easing direct taxation for eligible startups will encourage businesses to chase the right metrics and not just growth at the by bleeding money. The definition of “eligible startups” must be broadened to bring more companies in this fold.”
Raman Singh, Chief revenue officer at Cloud Connect
“At CloudConnect, we wholeheartedly believe that the progress of the country lies in creating more opportunities for start-up owners. Thus, we duly welcome the decisions taken by FM Nirmala Sitharaman through the Union Budget 2020. She has rightly mentioned that entrepreneurship is the true spirit of India and has been its strength. We appreciate the government’s emphasis on promoting cutting-edge technologies such as machine learning, robotics and AI in India. The commitment to tech-advancement to support entrepreneurship is evident in the government’s decision of building data center parks throughout the country and proposing INR 8,000Cr for over 5 years for the National Mission of Quantum Technology and Application. Finally, the setting up of investment clearance cells and portals for entrepreneurs in order to assist them in funding will give a significant boost to entrepreneurship in India.”
“There was lot more we were expecting from this budget 2020 on measures to revive the auto industry, increase in tax soaps, etc but it is good to see the focus on digital governance pushing for digital revolution in a big way. A viability gap funding window will be set up to set up hospitals in PPP mode and in its first phase those districts will be covered where presently there are no Ayushman empanelled hospitals. Machine learning and AI in Ayushman Bharat scheme shall enable better designed disease preventive regime and create better healthcare facilities”. “Recapitalization of INR 6950 crores of PSU Insurance companies will help in terms of improving their solvency metrics and is a step towards merger of the PSU general insurers.”
Santosh Agarwal, CFO at AlphaCorp
“We welcome the announcement of slashing the personal tax regime, cheering first-time homebuyers to invest in the real estate sector. The extension in the transaction values and circle rate is another appreciating step for the sector. Considering the rising demand for affordable housing, the government has announced the extension of one year till March 2021 on the deduction of Rs 1, 50,000 on sanctioned loans. This will encourage prospective buyers to avail of more benefits and invest in real estate. The emphasis given on infrastructural development of the country will help in seamless connectivity and also give thrust to the realty market.”
Dr. Pulkit Mathur CEO & Co-Founder at Queppelin
“It was heartening to see FM Sitharaman recognise the importance of Deep Tech is driving the next wave of growth in India. From AI in Ayushman Bharat to Data Centre Parks to allocation of Quantum Tech….there was enough in this Budget 2020 for the Technology sector to be enthused about.”
Also Read: Full Budget 2020 peach pdf version
