Can Budget 2018 Offer Respite To Tech Sector?

by Sohini Bagchi    Feb 01, 2018

budget

Union Budget 2018 that was expected to cater mostly to the needs of farmers and the rural population ahead of 2019 elections,  also underscored the importance and use of technology in various spheres of business and citizen’s lives. Finance Minister Arun Jaitley, said in his budget speech on Thursday that the government proposed a slew of technology measures to boost India to a digital economy, including the use of blockchain technology to encourage digital payments and curb the use of cryptocurrency, setting up of a national program to encourage artificial intelligence [AI] and providing easy internet access to villages.

“Benefits to the poor have been targeted more effectively with use of digital technology,” Jaitley said adding that technology underpins multiple proposals in the budget, for the fiscal year that starts April 1, most of which relate to the existing projects, but also got more incremental attention, both in terms of money allocated, and the purpose it has solved.

For instance, the  some 22,000 semi-formal village markets, or ‘haats’ will be upgraded to village agriculture markets and linked to e-NAM, an electronic backbone launched in 2016 and planned as a country-wide agriculture market — hence the name electronic National Agriculture Market.This is expected to help the vast majority of Indian farmers — 86 percent, who are small and marginal ones — get better access to markets. An agro-market infrastructure fund of Rs 2,000 crore will be set up for this purpose.

Thrust on education

In education, the FM said “technology will be the biggest driver” in boosting quality and we propose to increase the digital intensity in education and move gradually from ‘black board’ to ‘digital board.’”

As As Col. Rajendra Prasad Nadella, Co-Founder, Managing Director, iScholar said, “Education for once got due attention from the finance minister in the budget speech. Mr Jaitley acknowledged that technology will be the biggest driver in improving the quality of education. Among other major announcements are Eklavya schools in tribal districts on the lines of Navodaya schools, integrated B Ed, initiative for teachers training. Announcement of five lakh WiFi hot-spots in rural areas will enable access to high quality education to even even rural regions of the country.”

In higher education, Minister Jaitley proposed to kick off spending Rs 100,000 crore through the four years starting April 1 on an initiative named Revitalising Infrastructure and Systems in Education (RISE). A Higher Education Financing Agency is also to be set up. To encourage talented engineers to take up research and teaching, a new plan called Prime Minister’s Research Fellows (PMRF) will be launched to identify 1,000 “best B.Tech students” each year, from premier institutions and provide them facilities to pursue PhDs in the Indian Institutes of Technology and Indian Institute of Science, “with a handsome fellowship.”

Vijay Thadani, VC and MD, NIIT Ltd commented that this one is a progressive budget with the right emphasis on training of teachers, use of technology and funding for research. “Among the positive steps for the education sector, Revitalising Infrastructure and Systems in Education (RISE) by 2022 with a total investment of Rs 1,00,000 crore in next four years stood out. The fact that the Higher Education Financing Agency (HEFA) would be suitably structured for funding this initiative is a much appreciated provision,” he said. 

Naveen Mandava, Co-Founder - IMAX Program added, ”Budget 2018 comes with a positive outlook towards education. As outlined in the budget, getting students to the school is not a concern anymore but improvement in the quality of education is the need of the hour. For example, district-level tracking is a positive step, but we should fast move towards interventions that allow us to follow-up and improve every student.” 
 
A smarter, connected India
 
India’s Smart Cities mission aims at building 100 connected and state-of-the-art cities. The minister said 99 cities have been selected with an outlay of Rs 204,000 crore. These cities have started implementing projects such as command centres, roads with sensors, solar rooftops, connected transport systems and public parks with digitally-enabled services.
 

budget

 
On connectivity, phase one of India’s ‘Bharatnet’ optic fibre broadband network now touches 100,000 village panchayats, and reaches 2,50,000 villages comprising 20 crore people, the minister updated. The government will spend Rs. 10,000 crore in the coming fiscal year on augmenting telecom networks, including the creation of 500,000 Wi-Fi hotspots in rural areas.
 
Mitesh Shah, Head of Finance, BookMyShow said, “Initiatives such as High speed connectivity and Wi-Fi access to 5 Crore rural citizens and tax disallowance on cash expenditures above Rs. 10,000 for all entities now also give digital movement a great push and will benefit internet businesses.  However, some more direct incentives for promoting digital ecosystem in form of lower MDR or cashbacks would have been welcomed by online platforms as well as merchants.”
 
On the government’s focus to spread internet connectivity and strengthening rural broadband infrastructure, Pranav Roach, President, Hughes Network Systems said, “The Finance Minister announced during the budget speech that one lakh Gram Panchayats have already been connected thanks to expansion of the network but this also highlights the fact that more than 2 lakh villages are still awaiting access to high-speed broadband. Internet connectivity is undeniably a great enabler and also a medium through which maximum governance with minimum government can be implemented. Satellite broadband technology can greatly help connect the under-served and un-served regions. We request the government to use high throughput satellite connectivity we’re proposing to bring.”  - .
 
AI, 5G to drive economy
 
India’s Department of Telecom will also help set up an “indigenous 5G Test Bed” at the Indian Institute of Technology in Chennai. The budget speech also specifically called out emerging technologies that will become increasingly important to India’s position as a digital economy. The government’s think tank, National Institution for Transforming India, also called NITI Aayog in Hindi, will start a programme “to direct our efforts in the area of artificial intelligence, including research and development of its applications,” Jaitley said.
 

5g

 
To invest in research, training and skilling in robotics, artificial intelligence, digital manufacturing, big data analysis, quantum communication and internet of things, India’s Department of Science & Technology will launch a ‘Mission on Cyber Physical Systems’ to support establishment of centres of excellence. The department will see its annual budget doubled starting April 1, to Rs 3,073 crore.
 
Mayank Bhangadia, Co-founder, and CEO, Roposo,  The proposed plan to set up 5 lakh Wifi Hotspots is also quite a progressive decision, given that it is implemented properly and as soon as possible.The budget would have been a lot better if it focused more on start-ups which comprise the bottom of the industry pyramid. I believe incorporating that into the plan would have helped in the progression of the industry as a whole.”  

According to Prabhakar Chaudhary, MD - HAL Robotics said, ”Emphasizing Digital India powered over AI and by allocating substantial fund, this government has seriously understood the need and capability of technology. It’s great to see that government is recognising future technology for building nations future. Not only this helps in job creation but also advances the nation in competitive global space.”

L&T Technology Services, CEO & MD, Dr. Keshab Panda added, “We welcome the government’s thrust on encouraging R&D pursuits in the areas of AI, machine learning, robotics and edge analytics. This move will further leapfrog the innovations in this space that is significantly driven by Indian companies and will place the country at the centre of global digital transformation focus.”  

 Anil Valluri, President, NetApp India & SAARC sees the budget as a continued thrust on transformation. ”The focus on wide scale broadband access, on Machine learning, AI and robotics, on R&D as well as skilling, and on Smart Cities will keep pushing India’s Digital agenda, well supported by the additional fund allocation. It is a quietly progressive budget, and timed well to focus on readying all cross sections of Indian society to reap the benefits of the future.”

Blockchains to power digital economy

The government does not consider cryptocurrency as legal and will take all measures against its illegal use, said Finance Minister Arun Jaitley while presenting the Union Budget 2018. The government, he added, will explore the use of blockchain technology to add muscle to the digital economy. Cryptocurrencies were in limelight last year with multi-fold returns. The country was expecting some clarity on cryptocurrencies from the government.

Rather than restricting cryptocurrencies, they can be regulated to prevent any adverse impact and risks while exploring blockchain side by side and leverage opportunities which are available with new concepts and technologies that they bring to the table.”

Ajeet Khurana, Head, Blockchain and Cryptocurrency Committee of India says, ‘Hearing the Finance Minister talk about Cryptocurrency on Budget day is clear indication of how important and widespread this technological innovation has become in India. BACC welcomes the statement, and reaffirms our unstinting assistance to the Government, and all regulators, in helping evolve a robust ecosystem for Cryptocurrencies.’

A step up to cyber security

The government said it would up its focus on cyber capabilities, including developing and researching new technologies that can be leveraged for the future. He said that the Department of Science and Technology will launch a mission on cyberspace to encourage big data, cybersecurity and robotics with an allocation of Rs 3073 crore. In addition, the FM said the NITI Aayog will establish a program to encourage artificial intelligence and that the government will set up 5 lakh hotspots, with an outlay of Rs 10,000 crore.

Padmanabha Krishnamurthy, CFO at Paladion Networks commented, “The continued focus on digital growth by the Government including a special focus on Cyber Security with the launch of Centers of Excellence is a huge necessity for India and I am happy to see it in this Budget.”

cybersecurity

Keith Martin, Head, Asia Pacific, Corporate Business, F-Securetoo added that the announced the mission on cyberspace which will be launched in support of the establishment of centres of excellence and stated that the allocation to the Digital India programme has been doubled to Rs. 3073 crore in 2018-19. This is huge step by the government with financial backing to make India a cyber-secure nation as today, nearly all aspects of our lives are only, with everything from financial transactions to confidential personal data being accessible from every device increasing the risks of businesses and individuals to becomes easy targets to cyber criminals.

Despite the momentum in several spheres of technology in the Union Budget, experts believe, it remains to be seen how partners from the private sector eco-system with knowledge and expertise in these areas get involved in this initiative, believe experts, as D.D. Mishra, Research Director at Gartner said, “The budget does not generate excitement to the extent that was anticipated. Though the extension of rural WiFi hotspots along with investments in telecom can enable rural economy and drive much better financial inclusion and drive technology enabled growth for the subset of our rural population, we need a better connect between strategy and execution especially in terms of digital India so that we are able to fully leverage the enhanced allocation.

“Looking at the  overall picture, I feel that the approach is more fragmented at the moment and outcome and objectives of digital India needs to be better connected with the investments which are being made,” he concluded.