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Tech-Experts present a list of the key highlights for the budget for 2023

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For the last two decades, India has been on the path to establish tech supremacy. The country’s burgeoning digital economy is poised for expansion, and its contribution to the government’s aim of a $5 trillion GDP by 2025 is going to be undoubtedly crucial. With the announcement of the Union Budget 2023-24 by Finance Minister Nirmala Sitharaman only a few days away, the industry is hopeful for a major boost from the government.

With India emerging as a global hub for digital capability and the roll out of 5G services in the country, the tech sector in the country is looking forward to a period of growth and stability propelled by fresh policies and other provisions from the upcoming budget announcement. The industry has been a propellant for positive change for years, as it braces itself up for new ones.

We have curated an interesting collection of budget expectations from renowned industry leaders. Please let me know if you are working on any story that would benefit from the expert commentary, or if you would like to explore it in the form of a guest article.

Appended below are the budget expectation quotes from tech leaders.

  1. Mr Vinod Nair, Global VP of Sales and General Manager Noventiq India:

”The 2023 budget will be crucial for the IT industry as many headwinds globally impact one of India’s largest employers. In the past decade, Indian IT startups have preferred to have their corporate headquarters in the US or Singapore due to those countries’ favourable tax and compliance environments. If this year’s budget addresses this by providing more lenient and flexible compliance to startups, it will attract more investments and ensure that homegrown IT startups remain in India.

Additionally, the use of digital technology and the prevalent geo-political situation has created opportunities for cybercriminals waiting to exploit vulnerabilities. We have seen a significant rise in cyberattacks, resulting in the loss of confidential data and money for businesses.  Therefore, cybersecurity must be a top priority from the very beginning of digitisation to ensure digital transformation. The government should look at the loss of money to cybersecurity as a loss not just to businesses but to the government.

The future belongs to Digital India, and we can secure it by investing in cybersecurity rather than doing damage control after a cyberattack. As India prepares to become more digitally literate, we must strengthen our defences against cyber-attacks by improving data protection and having a much-stronger policy in place for all sectors.

In summary, as the Prime Minister, in his last independence speech, spoke about the next decade for India being a “techade”, the complete IT industry, with its importance in this journey, will be expecting many policies favouring the IT industry.”

  1. Mr Jesal Doshi, Deputy CEO, B Medical Systems

“Focusing on this year’s significant stories is essential as we cautiously enter 2023. The widespread vaccination effort, which immunised over 100 crore people, was a significant victory for the Indian government. All throughout the world, nations praised this courageous deed. We anxiously await the government’s announcement of funds for the initiatives we want it to prioritise this year. Spending more money on vaccinations is one of the goals, especially across the board in the healthcare system. India must have the right tools since the fight against COVID-19 is far from over.”

“Considering the drastically dropping immunisation rates, it also necessitates acting quickly. The government must enact stricter regulations for the storage and delivery of these life-saving vaccines to both the public and private sectors. Additionally, stress the significance of using certified, top-notch medical grade equipment. Once more, they must consider a more long-term framework to guarantee that immunisations are accessible in India’s rural areas.”

“We believe that separating the medical cold chain from commercial refrigeration and establishing a specialised business could aid in expanding the sector. To make it simpler to create dependable medical cold chain chains, the government should reduce import fees on necessary components.”

  1. Mr. Raj Sivaraju, President of APAC, Arete

India’s economy is rapidly advancing and will play a significant role in boosting the global economy. The country’s technology industry will attempt to identify the cybersecurity investment necessary for the tech sector as the government is scheduled to propose its budget for FY2023–24 in a few weeks. With the rapid implementation of technology initiatives and programs, the lowering of administrative backlog, and inclusive development in 2023, the cybersecurity industry is expected to generate US$2.37 billion in revenue. Security Services is the market’s biggest category, with a US$1.19 billion market volume anticipated in 2023. By 2027, the market is projected to generate revenues with a compound annual growth rate (CAGR) of 14.61%, amounting to US$4.09 billion. The country’s IT industry will closely monitor the spending on requirements for digital public infrastructure, capability building, and incentives for enhancing cybersecurity services.

 

  1. Mr. Priya Ranjan Panigrahy, CEO and Founder of CEPTES Software

Digital India Program is a great initiative for companies like start-ups, SaaS based and new-age companies. We are creating the SMB booster program in cloud space which enables small businesses to get into the digital transformation very quickly without much hassle, which can take care of sales, service, marketing automation and also connecting to finance operations like automatic e-invoice and automatic billing solutions can be done. We also do KYC solutions which can be so easy to adopt. The budget will be focusing on measures that support growth and innovation in the software and SaaS industry. Support for the development and adoption of new technologies such as cloud computing artificial intelligence, machine learning and the Internet of Things.

Technology Clusters in tier 1 cities in India; while there are IT talents every corner in India they are forced to move to tier 1 cities. As a result, big cities are enduring infrastructure issues. Govt. must come-up with a special budget for booming IT infrastructure in tier 2, or Tier 3 cities as well to take-off the load from big cities. Measures to address the skills gap in the IT industry and support for training and upskilling of workers. Tax incentives for companies that invest in research and development. This year’s budget may also include measures to address concerns around data privacy and security, as well as efforts to increase the adoption of digital technologies in various sectors.

 

  1. Mr. Sujit Patel, Founder and CEO, SCS Tech

With the world moving to digital products and services, cybersecurity becomes very important for individuals and companies to take care of their digital assets like sensitive data, PII (Personally Identifiable Information), PHI (Protected Health Information), intellectual property to name a few.

While speaking about cybersecurity threats as malware, spoofing, phishing or third-party data breaches one should implement the minimum cybersecurity requirement as per their scenario, corporates should pay enough attention to latest cyber security tools, security employees’ training and education, controlling physical access to their digital data, in-time updates for the software; making proper backups of the information, and securing the internet connection.

Like they say, ‘Prevention is better than cure’.

 

6.  Parag Khurana, Country Manager, Barracuda Networks India

“Cybersecurity has been a crucial segment. The cybersecurity breaches that various public sector entities highlight the need for a more robust cybersecurity infrastructure in the country, which is something that cannot be achieved without the government’s support.

With the Budget 2023 just days ahead, we expect an increased budget allotment to the MeitY, and by extension, cybersecurity to provide improved protection to the country’s digital security infrastructure, especially for public sector entities that store crucial, extremely sensitive personal data for the state and its people.

Additionally, the sector also expects more investment from the government in R&D and incubation, which can be supported by extending initiatives such as the Startup India Seed Fund Scheme to the budding ventures in the industry. Strong public-private partnerships can also be established to create better R&D infrastructure for the tech sector.”

 

7. Ashish Tandon, Founder & CEO, Indusface

Businesses and governments across the world have made a paradigm shift in the way they interact with their customers as well as citizens using digital strategies, aided by cloud infrastructure and AI/ML tools. However, along with the benefits of ‘digitalisation’ i.e. speed, agility, accuracy and convenience also comes the risk of cyber-attacks given that the hackers too have access to these technologies and tools at their disposal. Some recent data breaches, phishing and cyber-attacks include those endured by Twitter, WhatsApp, SHEIN and AIIMS.
According to a recent study released by Indusface, India is one of the most cyber-attack prone countries in the world. Out of the 829 million cyber-attacks detected and blocked by our platform globally in the fourth quarter of 2022, close to 59% were Indian websites.
As a fundamental change takes place in the way software is delivered – from perpetual on-premise licenses to ‘Software as a Service’ (SaaS) from the ‘Cloud’, it is important to leverage these solutions for effective, automated, and AI-powered cybersecurity benefits.

With the Indian government betting big on digitalization and using SaaS as a platform to deliver its services to citizens, there is a need for them to also allocate adequate budgets to integrate these solutions into their own operations. Collaborating with private cybersecurity SaaS companies that have built the required agility and innovative AI-powered solutions can help them yield greater results compared to the conventional approach of procuring and maintaining obsolete infrastructure. The Union Budget is the ideal financial plan that must focus on this urgent need for a cybersecurity revamp in government departments to prevent the recurrence of attacks like the one AIIMS had to endure recently.

 

8.  Manoj Paul, Managing Director, Equinix India.

“The data center market in India has seen substantial growth in the last few years. India’s continued digital push and exponential data growth have resulted in strong demand for digital infrastructure. The recent report states that the Indian data center industry market size was valued at USD 4.35 billion in 2021 and is estimated to witness investments of USD 10.09 billion by 2027, with a CAGR growth of 15.07% during 2022-2027.

The Indian domestic market is huge and very exciting for players like Equinix,. and we hope for favorable policies that fuel growth and investment in the sector and help India emerge as a ‘global data center hub’. In this context there are two areas of immediate attention:

1) India requires a strong ICT infrastructure, with investments in undersea fiber networks linking the country with other nations, between and within cities, and cable landing stations, all of which is crucial for a digital economy. In the last few years, India has improved significantly with existing and new carriers laying fiber and offering 100G/200G wavelengths and aims to scale up to 600G/800G. However, there is a demand for huge investments to place additional fiber within India specially connecting Datacenters and Cable Landing stations within the same citiy and in different cities across the country for the demand for new age dark fiber to support surge in bandwidth and redundancy. To support 5G deployment, all base stations and mobile towers must be linked over fiber for improving bandwidth availability to customers, this is critical for the success of 5G and hence necessary for accelerating growth in data consumption. Additional investment in fiber is also required to decrease the bandwidth costs of connecting data centers across the country. The industry is looking forward to favorable changes in the policies which will encourage new investors like Datacenter service providers, new age telecom service providers supported by OTTs, cloud service providers and data center service providers among others to deploy new age fiber networks within the country to meet the growing demand. Dark fiber policy has been the ask for data centers and OTTs and CSPs which if fulfilled will fuel the growth of data centers and align India with other countries which allow dark fiber and improve Ease of Doing Business index of India.

2) Data centers need big amount of power, in 10s of MWs going upto 100 MW. This would need significant investment from the power distribution companies to meet the deamding and we expect the government to make provision in the budget for this investment. Data centers consume uniform power across the day and night and also pay much higher tariff than domestic users and hence should be seen as profitable customers justifying the investment. Availability of sustainable power is another significant factor which impacts the growth of data centers. The government can increase focus on sustainable energy and make provisions in the budget for green data centers and big investments for power generation and improvement in power distribution infrastructure so that the upcoming demand of power requirement for the data centers can be fulfilled efficiently. The industry has also pointed out the changes needed in power distribution policies to allow the data center industry to use “Green Power” more effectively and clear roadmap for data protection policy.”

 

9. Harshvardhan Lunia, founder & CEO, Lendingkart Technologies

“According to RBI data, microfinance companies’ loan book stood at Rs 3 lakh crore as of September 2022, increasing by 23 percent from last year. With the increase in demand for microfinance and digital lending companies, the budget should provide due consideration to boost liquidity support to the NBFCs as well as encourage frameworks like co-lending, which will greatly boost the reach of financial institutions and progress in the financial inclusion imperative. While the Reserve Bank of India has set the regulatory ball rolling for innovations like UPI and Account Aggregator, the Budget can encourage the uptake of these technologies in the financial sector through partnerships with digital service providers either by direct funding or tax incentives.

For the MSME sector that was adversely impacted by the pandemic, it would be helpful for the Government to extend the credit guarantee scheme, which was slated to end in March of this year, for another 3 years. To widen the reach of scheme’s benefit, the Government should increase the maximum loan amount from 10 lacs to 25 lacs under CGFMU scheme. This is a critical sector for job creation and income distribution, and it is expected that the government will focus on significantly improving the cost of doing business here.”

 

10. Sean Yalamanchi, President, Infovision

“As an IT Company, we have our own unique set of issues and expectations from the budget.

  • MAT to have two slabs – similar to corporate tax – to help incentivize smaller IT companies – this will help in better-working capital management.
  • For smaller IT companies – Government to provide an incentive – a tax holiday for 5 years – to set up offshore development centers in Tier 2 and Tier 3 locations – to improve employment opportunities
  • Safe harbor margin notified for companies – This is to be enhanced – from the current limit of Rs.200 crore (company turnover) to Rs.500 crore– The limit has not been revisited for more than a decade. This will help reduce compliance requirements for smaller companies.

Government should actively consider the cost of compliance, litigation, and the refund process to improve the ease of doing business

  • Vendor credit – Government to take steps to enable a mechanism to track vendor compliance on the GST front rather than putting the onus on the service receiver. The cost of compliance is putting a burden on the service receiver.
  • Time Limit – With provisions such as Sec 16 (4) of the GST Act wherein there is a time limit for a business taxpayer to avail GST credit, but the time limit to open and re-open assessment under GST Act still remains open-ended.
  • Tribunal – Government should prioritize setting up the tribunal for the GST cases to address the grievances or litigation to make compliance easier specially for the SMEs.
  • Streamline the faceless assessment process so that the companies are not burdened with additional litigation and/or getting the refund faster”

 

11. Ashwani Rawat, Co Founder & Director, Transerve Technologies.

Geospatial technologies are revolutionizing the way governments and private organizations plan and implement policies and programs. The recent announcement of new Geospatial Data guidelines by the government marks a major shift in policy and underscores the importance of creating fresh data sets to fully utilize these guidelines. Through public-private partnerships and private sector involvement, we can see the implementation of various government programs and projects.

The upcoming budget should allocate funds for a period of five years for national mapping organizations like the Survey of India and Geological Survey of India to update existing data sets and create new data sets. Additionally, the industry is calling for increased funding for the use of geospatial technologies in programs such as Gati Shakti, Har Ghar Jal Jal Shakti, MoRTH, and MoHUA. With the aid of geospatial data and technologies, we can achieve more efficient execution of these programs and achieve greater impact.

 

12. Agendra Kumar, MD, Esri India

“The Government announced a very forward-looking National Geospatial Policy in December 2022 with an objective to make India a leader in the geospatial space. This policy will support the growth of the geospatial economy in the country. Various government bodies have been identified in the policy for data creation and management. Along with strengthening the Geospatial Infrastructure, the policy also talks about the creation of a National Digital Twin. These initiatives will materialize only through appropriate funding, and this is the expectation from the Union Budget 2023.”

 

13. Jagdish Mitra, Chief Strategy Officer & Head of Growth, Tech Mahindra

“The year 2022 has been a transformational year for India and for the world. We witnessed disruptions in India followed by recovery and revival. India also emerged as a fast-emerging developing country and a ‘bright spot’ in the global economy. I believe, in order to maintain the growth trajectory, the need of the hour is to further push the development of the technology ecosystem through a tech-driven, forward-looking budget. We look forward to seeing focused initiatives to boost consumer sentiment, improve Ease of Doing Business (EODB), strengthen infrastructure, and promote investment in critical areas including healthcare, network modernization, skilling & job opportunities, and financial inclusion.  We hope the upcoming Union Budget 2023 will be a beacon of hope for creating National R&D Ideas Incubators, which will nurture critical cross-disciplinary research, new ideas, and technologies through the early phase. Encouraging joint collaborations and ownership by industry and academia, along with centers of expertise will also be a welcome experience. The IT sector is poised to play a crucial role in fulfilling the Government of India’s vision and mission of ‘Make in India’ for the world, – all it needs is a final push – which the upcoming Budget could grant.

 

14. Divyesh Sindhwaad, VP India, Skillsoft

In the 2023-24 budget, we are hoping to see some measures that will help tackle the skills gap which is plaguing the technology workforce in India. Skillsoft’s 2022 IT Skills & Salary report shows that most IT leaders around the world (66%) are still experiencing skills gaps in their teams. With a constantly evolving technology environment and intense competition for specific skillsets, the government can help by investing in policies, tax rebates or schemes that enterprises can leverage to help evolve their learning and development practices to tackle the skills gap and foster growth.

As forward-thinking enterprises look at reskilling and upskilling their workforce to drive critical skills transformation, the government must also play a key role by encouraging all enterprises to commit to a modern workforce strategy that places skills at the center. One way of doing this is by mapping out the relationship between industry demands and the supply of technology courses through public-private partnerships. This will open avenues for EdTech players to enable and empower the existing workforce and create an agile, job-ready talent pool for the country.

 

15. Vijendra Katiyar, Country Manager, India & SAARC, Trend Micro

“As the Government of India gets set to present its budget for FY 2023–24 tomorrow, the technology sector will be keeping a close eye on the investment made towards securing the evolving digital infrastructure in the country. Cyber-attacks increased significantly in 2022, with the total number reported by CERT-IN standing at 12.67 lakh, including attacks on critical governmental infrastructure ranging from Indian Railways and CDS (Central Depository Services) to AIIMS, indicating the urgency with which this issue must be addressed. A robust digital infrastructure with a proper security framework is a necessity for sustainable growth in the current environment. For the 2023–2024 budget, the industry expects an enhanced focus on cyber security programmes to encourage talent building, secure digital infrastructure for businesses, and implementing information security training across government, healthcare, BFSI verticals, etc. that saw increased cyberattacks in 2022. Funds should also be allocated equally towards research and development in the field of cybersecurity, given its criticality. Along with it, a fair share of the budget should also be allocated towards bridging the widening talent gap. Post the developments in the past year, it will be of utmost importance to realise that cybersecurity is not a luxury anymore, but the need of the hour. Moreover, it is important that the entire ecosystem—from government to educational institutions, corporations, and industry bodies—work more closely to enable a secure digital India.”

 

16. Uthaman Bakthikrishnan, Executive Vice President, ClearTouch

“The government is putting a major emphasis on digitization in the current year, making the IT sector a crucial pillar for this goal. The industry is eagerly awaiting tomorrow’s budget, as the IT-BPM sector saw a contribution of 7.6% to the economy in the previous year, with expectations for this figure to increase to 10%. It is imperative that workers have access to the proper training and upskilling opportunities to continue this growth trajectory. This is why continuous training and reskilling is of the utmost importance.

As per the 23rd economic survey, the country has 9000 start-ups and it is essential for the country’s growth to provide them, as well as MSMEs and corporations, with the right opportunities through subsidies and SEZs. Opportunities are no longer limited to just metro cities, as smart cities are offering opportunities across the country; Bhubaneshwar has become the IT city of the east and the upcoming GIFT city in Gandhinagar showcases how the horizon is broadening for IT across the country. With the introduction of 5G, the existing digital infrastructure is reaching new heights, providing opportunities for everyone from corporations to the general public. This has had a positive impact on multiple sectors such as data centers, education, and fin-tech, allowing them to achieve more with faster internet.

Overall, this budget is poised to be a time of growth and opportunity for all, with the IT sector at the forefront of this progress.”

 

17. Samit Banerjee, Division President, Cloud Operations Services & Head of Customer Service Unit, Amdocs

‘In 2023, organizations are expected to continue to focus on accelerating digital transformation and drive efficient growth to better navigate the disruption. An increase in investments and importance will be witnessed in cutting edge technologies like, Artificial Intelligence (AI), Big data, and Cloud computing among many. Organisations can leverage the emerging technologies to reduce work processes bottlenecks, incorporate efficiency in processes & save time and money. Further to this, enhanced automation can lead to more refined processes vary of human errors and cloud computing to enhance workflow within the organisation. As change comes with its own set of challenges, one of the key challenges that organisations will continue to face in their digital transformation journey is lack of a skilled workforce, a lack of an overall digitalization strategy, and a limited budget, to name a few. Regardless of the current demand for skilled workers, we can expect an increase in demand for data engineers, cloud engineers, and professionals with AI knowledge, experience, and skill set in 2023, among many others. As a result, organisations must continually upskill and reskill employees to keep up with changing times and bridge the talent gap.’

 

18. Ruchir Shukla, MD-India, SafeHouse Tech. 

“We are eagerly looking forward to the financial budget for 2023 and hoping the government will put a key focus on securing our nation’s digital infrastructure and spreading awareness on digital hygiene. In light of the rising frequency of data breaches, hacking attempts, ransomware attacks, and more Indian citizens coming online, the government must prioritize cyber resilience and protecting people’s digital identities. With the upcoming budget, we are also hoping to see initiatives aimed at supporting small and medium enterprises in the cybersecurity industry, as they play a critical role in creating innovative solutions for safeguarding our digital systems and ensuring the security of sensitive information.”

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