Tech Sector Leaders Largely Bullish On India’s Budget 2023

The Central Government’s Budget for 2023-2024 surprisingly proved many wrong as it veered away from the idea of being a populist one despite the upcoming elections. While the Modi-government managed to woo the Indian middle class with tax rebates, the grander scheme of things wasn’t much out of the ordinary. But the budget did emphasise on technology-driven growth to provide impetus and drive India’s goal of becoming a USD 5 trillion economy.

On Wednesday, Finance Minister Nirmala Sitharaman announced a series of measures intended to encourage innovation in artificial intelligence (AI), including three Centre of Excellence, which will be set up at top educational institutions. In addition, she said that leading industry players would partner in conducting interdisciplinary research, develop cutting edge applications and scalable problem solutions in the areas of agriculture, health and sustainable cities.

Sitharaman also announced the National Data Governance Policy, which is intended to enable access to anonymised data. “The KYC process will be simplified, adopting a risk-based (approach) instead of one-size-fits-all approach. The financial sector regulators will also be encouraged to have a KYC system fully amenable to meet the needs of ‘Digital India’,” she said.

In addition, the Finance Minister also announced that the government will set up Data Embassies in the country to facilitate seamless digital transfers and continuity for other nations. 

Under the Union Budget 20023, 100 labs were also announced for developing applications using 5G services. These will be set up in engineering institutions across the country. Sitharaman said that this would bring forth new range of opportunities, business models and employment potential.

BW Businessworld asked some leading tech leaders on their thoughts for the Union Budget 2023-24. Here’s what they said:

Rajesh Gopinathan, MD & CEO, Tata Consultancy Services (TCS):

“The Union Budget 2023 by the Honourable Finance Minister further builds on the government’s focus on enhancing India's digital infrastructure and enabling growth pathways for the Indian economy. The provisions for research in artificial intelligence and 5G implementation, and the Government's vision of Make AI in India and Make AI work for India are commendable. Bringing in the National Data Governance policy is also a welcome step. Overall, it's a forward-looking budget that will fortify the digital spine of the country.”

Rekha M. Menon, Chairperson and Senior Managing Director, Accenture in India:

“Strong focus on the knowledge economy with technology as the bedrock for boosting socio economic growth and green development. The government’s intent to set up three centres of excellence (CoE) will encourage the ecosystem to Make AI in India and Make AI work for India.

While Agriculture, Healthcare & Sustainable Cities are the current focus of CoE’s, India has multidimensional potential – AI can add an estimated USD 450-500 billion to India’s GDP by 2025, and more than 60 per cent will be from four key sectors – Financial Services, Consumer Packaged Goods & Retail, Healthcare, and Industrials & Automotive. India will need to continue to invest in these centers to keep pace with the evolving asks across all sectors.

Further, the unified skill India digital platform coupled with skilling in areas like robotics, coding, and other soft skills will enable industry ready talent at scale and foster greater entrepreneurship, helping India realise its demographic dividend and lead in the techade.”

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

“It is a very positive budget from a technology sector perspective, as it sets the right message about 5G labs, setting up AI centre of excellence and the focus around skilling, which is absolutely the key need for the country as we live through the Prime Minister’s vision on TechAde and technology being the core enabler. From a business perspective, steps around ease of doing business have been taken and I think that's commendable. I would like to congratulate the Finance Minister and the government for taking these steps.”

Sindhu Gangadharan SVP & MD, SAP Labs India and Head, SAP User Enablement:

“The Union Budget 2023-24 is a testament to India’s unwavering focus on building a technology-driven economy that is both sustainable and inclusive. Drawing a parallel to its undertakings to shaping the Techade, it underlines the imperative of job creation and youth upliftment through the PM Kaushal Vikas Yojana 4 that aims to upskill lakhs of youth in new-age courses such as 3D printing and drone technologies. In line with this, the establishment of 30 Skill India International Centres across states will be critical to developing and nurturing the digital talent pool in the country. Additionally, the launch of the National Data Governance Policy and three Centres of Excellence for AI are initiatives that will help further reinstate India’s position as the global innovation hub. In fact, the launch of 5G labs will create new avenues of opportunities through the network’s rapid and efficient expansion. On the sustainability front, the strong push towards green growth which entails provisions to accelerate the adoption of green fuel, energy, and mobility will not only help India achieve its net zero target but also help create new green job opportunities.”

Varun Sridhar, CEO, Paytm Money:

“Union Budget 2023 reflects the government's focus on inclusive growth and digitisation. The stability of reforms will contribute to the India growth story and will positively boost the morale of capital markets. From the simplification of KYC, cap on the maximum tax rate, to increasing the rebate on income tax and strengthening our infrastructural power — there are many welcome moves that will benefit Indians.”

Lt. Gen. Dr. S.P. Kochhar, Director General, COAI:

“The Union Budget 2023-24 has introduced some provisions which are expected to indirectly have a positive impact on the telecom sector. The budget lays emphasis on innovation, job creation and skilling, with continued push towards Digital India. The capital investment outlay has been increased by 33 per cent to INR 10 lakh crore and we hope the same would include development of infrastructure for proliferation of telecom and digital services. We welcome the announcement on setting up of 3 centres of excellence for Artificial Intelligence (AI) and 100 labs in engineering colleges for development of 5G applications, which are progressive steps and would help fuel the proliferation of 5G and its ecosystem in the country. The revision of Income Tax slabs could also help increase disposable income for the people, leading to greater adoption and use of data connectivity services.

The industry had requested for some measures to be introduced in the Union Budget 2023-24, to ease the regulatory and financial burden on the sector. We are hopeful that the industry’s suggestions to reduce regulatory levies like License Fee, deferring USOF contribution till the existing funds are exhausted, exemption of Basic Customs Duty (BCD) on Telecom equipment, waiving of GST on regulatory payments, refund of ITC, among others, will be considered and addressed by the Government during the course of the year.

We feel that the Government’s support for this industry is crucial, especially when 5G is slated to be an enabler for several other verticals – for increasing efficiencies and output across various applications and use cases – whether for governance, businesses and public utilities, as well as in our pursuit of achieving Industry 4.0. Telecommunications is the backbone of India’s digital economy, as established by the success of the JAM trinity – Aadhar, Jan-Dhan Yojana and penetration of mobile telephony, which has propelled financial inclusion in recent years. The 200 per cent increase in rural internet subscriptions between 2015 and 2021 in comparison to 158 per cent in urban areas bears testimony to the efforts being made jointly by the Government and the industry for enhancing pan-India digital connectivity. We will continue to collaborate and actively contribute to catalysing the government’s dedicated digitization efforts to enhance digital penetration and bridge the digital divide to help India achieve its vision of becoming a USD 5 trillion economy by 2024-25.” 

Anil Kumar Jain, CEO, NIXI:

"The all-encompassing nature of Digital India has been endorsed by the 2023-24 budget announcements of our Finance Minister, Smt. Nirmala Sitharaman, in line with the vision of our beloved Prime Minister, Shri Narendra Modi Ji. Education, macro and micro infrastructure, banking, cyber security, defence, and more, are being ably represented towards Amrit Kaal. Up to 2 per cent of India's GDP is expected to be powered by 5G. Given this, establishing 100 labs for developing apps using 5G services is a positive step to increase 5G penetration in India. In addition to 5G, the next wave of technologies, such as Web 3.0 and Metaverse, will usher in a new era of economic opportunities. I strongly stand by the National Internet Exchange of India's efforts to empower all citizens to build a better future for themselves."

Also Read: Budget 2023: FM Lays Down Vision For Tech-Driven Development Via AI, Data Governance