Union Budget 2021: Finance Minister Nirmala Sitharaman today announced the Budget 2021 that will be applicable for the upcoming fiscal year starting April, 2021. Here's how the tech industry reacted:
Ketan Patel, Managing Director, HP India Market, said, "Today’s budget announcement confirms government’s focus on developing infrastructure and skills which will have short and long term benefits to Indian economy & people. From a technology point of view, the incentives for creating digital infrastructure, education and skilling spells out the government’s intent on developing the country’s human capital. Steps like international collaboration to develop new skills will help Indian youth prepare for modern job requirements and make them global-ready."
"The announcement of the National Digital Educational Architecture (NDEAR) is a welcome step, which will help build a Digital First mindset in the entire education system in India and help students and educators adopt new ways of learning and teaching. In addition, we welcome the doubled allocation for MSME sector which will incentivise digital transformation of our small businesses that are the backbone of our economy," he further added.
Akhilesh Chopra, Sales Director, Bluei said, "We appreciate that the government’s focus on encouraging manufacturing in India will boost e-commerce growth in the long run. Mobile, charges, and power banks can be expensive in the coming times. This is because Finance Minister Nirmala Sitharaman has proposed to increase customs duty (import duty) on mobile phones and power bank sub-parts for FY 2021. The aim is to promote local manufacturing in the country, the rebate on all parts of mobile phones and parts of chargers is being withdrawn."
"Now 2.5% import duty will be levied some parts of mobile phones and chargers will now be subject to 2.5% customs duty. Till now, there was no duty on these parts. Increasing custom duty will certainly make it expensive for the companies to procure these mobile parts. To make up for this, mobile companies may increase the prices of mobile and power bank in the coming time. The motive behind increasing customs duty is that the government should manufacture these parts in the country. And the pandemic has provided the center an opportunity to attract global manufacturers and make the country a manufacturing hub emerging as an alternative to China," he further added.
Mr. Mandeep Arora, Managing Director, UBON, said, “At UBON, we believe that the Budget 2021 is an encouraging one. Proposing the scheme to encourage domestic electronic manufacturing mobile phones, semiconductor packaging and electronic equipment is a welcoming move and we look forward to a complete policy to leverage it in expanding manufacturing in our new factories. Furthermore, painting a futuristic picture in this year’s budget, madam finance minister acknowledged the role of advanced technologies like IoT, AI, and analytics in shaping the world. 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."
Sameer Katole, CEO, Crossloop, said, "The Hon’ble Finance Minister laid major emphasis on enhancing domestic manufacturing of electronic equipment. The Union Budget 2021 has a strong focus towards the revival of the economy and extensive plans for Atmanirbhar Bharat. It shows extreme commitment towards a strong comeback for the sectors which faced major backlashes in 2020. The budget covered several demanding issues faced by the economy earlier and with an attention concerning startup community, the extension of tax holiday for start-ups by one more year is an important decision made. This will encourage the survival of startups and give them the required support for bounce back. Further, the increased spending on PLI for electronic manufacturing schemes is a positive sign. The 2.5% taxation on manufacturing of smartphone parts is also a vital decision as it will boost the inclusive growth of the country and further bring major changes in the consumer electronic and domestic manufacturing segment."
Yashash Agarwal, CEO, Gamezop, said, "The proposed broadening of the definition of Small Companies to include those up to Rs. 2 Cr. in paid up capital (as opposed to current limit of Rs. 50 lakh) as well those who have turnover of up to Rs. 20 Cr. (as opposed to Rs. 2 Cr. currently) is meaningful.
Companies that qualify as Small Companies are subject to lesser number of compliances in conduct of board meeting, internal financial control reporting, annual return and financial statements, and so on. Hopefully, from here we will see further reduction in compliance burden for startups."
Mr. Lalit Arora, Co-founder and CEO, VingaJoy, said, “The Union Budget 2021 has given a hope to the consumer durables industry as it provided incentives for local manufacturers, reduction in taxes on eco-friendly and energy-efficient products along with waiver of customs duty on imported inputs to make components. It is likely to attract global players in the Indian manufacturing sector as the Government is planning to offer plug-and-play infrastructure to the companies willing to come to India. Domestic electronic manufacturing has grown rapidly. We are now exporting items like mobiles and chargers. For greater domestic value addition, we are withdrawing a few exemptions on parts of chargers and sub- parts of mobiles. Further, some parts of mobiles will move from ‘nil’ rate to a moderate 2.5%.”
Mr. Marthesh Nagendra, Country Manager - India & SAARC, NETGEAR, said, "Substantial increase in health budget will ensure that India successfully beats Covid-19 and no more lockdowns which in itself is a big boost for business. The Government has also stressed upon the digital connectivity to promote digital mode of payment which is certainly a huge step for the internet companies. We at NETGEAR feel that each and every individual and organization must be equipped with tools and solutions with better internet connectivity as most of the industries would be more dependent digitally in near future"
Kartik Sharma, Co-Founder, DcodeAI, said, “The government's continued efforts to boost the excellence of education in India is greatly appreciated. With an emphasis on strengthening the Nation First Policy in Union Budget 2021, the government will offer robust remedial solutions that are aligned with the vision of creating a thriving education ecosystem. With a focus on education for all, providing quality education through National Education Policy (NEP), collaboration with Japan for the sharing of technology and knowledge, skilling youth and launch of data analytics, artificial intelligence, machine learning driven MCA21 Version 3.0, the government have rolled out incentives to provide impetus to the activities and subsequently to the growth of EdTech as well as of skill-tech enterprises. Such incentives along with funding provisions will create space for collaboration amongst start-ups, especially in the education sector and open up new avenues of career growth for Indian professionals. “
Mr. Hari Om Rai, CMD, Lava International Limited, said, "It is a historic budget making a mark of the beginning of a new India. Government has given a clarion call to the industry with the announcement of creating global champions from India and backing this strategy with new, 'development finance institution'. Now the responsibility shifts to the industry to not only dream but dream big and stand together with the government to make the country progress from poverty to wealth over the next three decades."
Mr. Nanda, CO-Founder, WinZO Games, said, “The measures announced by the government demonstrate its bullishness towards the startup ecosystem. The extension of long-term capital gains by another year will offer tailwinds to early-stage funding. Extension of tax holiday by one year is also an encouraging offering, however, most of the new-age startups don't start booking profits in the early years. The Budget’s focus on economic development, infrastructure and health will definitely put India back on the growth trajectory after an unprecedented past financial year.”
Rajan Navani, Vice Chairman & Managing Director, JetSynthesys, said, "I’m happy to see the Union Budget 2021 is a forward-looking one, with massive spend commitment by the government across many sectors combined with large divestment and monetisation, along with the privatisation of two public banks and one insurance company. This is a great trajectory for banking in India. Also, the increase in FDI in insurance to 74% with management control will help in attracting FDI from the world, further boosting the economy. I’m particularly excited about the government’s commitment to set aside an outlay of INR 50000 Cr for the National Research Foundation, the setting up of a new Fintech hub, and an allocation to incentivise digital payments. Also, as we complete 75 years of independence, the move to exempt senior citizens over 75 years from filing tax returns if they are only on pension is a great tribute to their contribution to India."
He further added, "The budget also had a number of bold initiatives to simplify tax processes for businesses and honest tax-payers. The extension of the tax holiday and exemption of capital gains will also enable businesses and startups to focus on growing their business. Most importantly, the proposed use of data analytics, Artificial Intelligence and Machine Learning, optimising the Ministry of Corporate Affairs and tax portals, is indicative of the New India of 2022. I hope this forward-looking budget will help revive India’s economy, propelling it further towards a digitally empowered tomorrow."
Mr. Agendra Kumar, President, Esri India, said, “The budget seems to have lot of promise for GIS industry, the investments announced in Urban Jal Jeevan Mission, waste management, road infrastructure, electricity distribution, city gas distribution are the steps in the right direction and are likely to give boost to the usage of geospatial technologies in these key sectors.”
Atul Rai, CEO, Staqu, said, "In the Union Budget 2021, FM Nirmala Sitharaman made several encouraging announcements when it comes to India’s technology sector as well as the startup ecosystem. It was announced that cutting-edge tech including data analytics, AI, ML, and MCA-21 version 3.0 will be launched to have additional modules for e-adjudication, consultation, and compliance management and monitoring. This, along with the proposed extension of tax holiday for start-ups by one more year, will enhance ease of doing business and encourage the next generation of tech companies to step up and carry the mantle of development towards a digital-first future in line with the PM’s Digital India mission. The Finance Minister also proposed to revise the definition of small companies under Companies Act, 2013 by increasing their threshold for capitalization to not exceeding INR 2 crore from the current INR 50 lakh and turnover to not exceeding INR 20 crore from the current INR 2 crore. With this step, the Government aims to benefit about two lakh companies."
Mr. Rajit Bhattacharya CEO Data Sutram, Location Intelligence Enterprise, said, "We welcome this budget as it steers growth in the right direction. Extension of tax holiday by one year is a great move that will give startups more time to evaluate and fix things, owing to the pandemic-related challenges. We are also happy to see the government’s increased focus on technology by leveraging data analytics, AI, ML to revamp MCA-21 portal. This will ensure seamless compliance across businesses of all sizes. With the integration of these advancements, we can expect the MCA-21 3.0 to be equipped with new features like a single source of truth, ease of doing business, e-adjudication, online compliance monitoring, to name a few. Incorporation of one-person companies to incentivize innovation is another ground-breaking move for startups and will help them grow without any restrictions, mainly on paid-up capital and turnover. The technology-driven moves taken by the government will also help streamline India's healthcare and pharma industry while widening the avenues for recruitment across the startup ecosystem in India."
Rakesh Deshmukh, Co Founder and CEO, Indus OS, said, "The announcement of the National Language Translation Mission is a much needed effort by the government to reach our citizens in the language they understand. At Indus App Bazaar, the usage of apps in Indian languages on our platform has increased 2.2 times last year. We believe that with an enhanced app store ecosystem we will be able to break linguistic barriers and adding more value to the next half a billion Indian customers. Moreover, for Atma Nirbhar Bharat to be successful, the focus should be on technology innovation as a whole. We appreciate the government’s focus on innovation and R&D in the budget 2021."
Mr. Mike Chen, General Manager, TCL India, said, "We do welcome the recent PLI scheme of the government. However, we need to ease up the duty imposed on raw materials keeping in mind the make in India thought. We should also be getting added incentives so that transformative measures can be taken. The industry contributes 25% of the country's GDP."
Mr. Abhishek Kumar, Regional Director, Oncam, said, "One of the key focus area in annual union Budget is on infrastructure. The decision to boost the transport sector by allocating increased budgets for National Highways and Metros shall create opportunities for overview and incidence detection solutions. Oncam with its unique position in the market as the best overview surveillance solution is strategically placed to further increase its market share in roadways safety security solutions. The union budget is intelligently thought of and shall propel India as the fastest growing economy of the world."
Varun Saxena, CEO and Founder, Bolo Indya, said, “Skill India empowers Indians to build a sustainable financial career around their interests. This is where the passion economy driven model of Bolo Meets adds value to the next half billion internet users of India, by letting them monetise their social capital and become Aatmanirbhar. We welcome the increase in Skill India expenditure by the government.”