Top IT industry leaders have welcomed the budget's thrust on domestic manufacturing, incentivising digital transformation and helping Micro, Small & Medium Enterprises (MSMEs) thrive after a pandemic-hit 2020. Union Finance Minister Nirmala Sitharaman on Monday doubled the budget allocation for the MSME sector to Rs 15,700 crore from last year.
Ketan Patel, Managing Director, HP India Market told IANS that the announcement confirms government's focus on developing infrastructure and skills which will have short and long term benefits to Indian economy and people.
"We welcome the doubled allocation for MSME sector which will incentivise digital transformation of our small businesses that are the backbone of our economy", Patel said.
According to Rahul Agarwal, CEO and Managing Director of Lenovo, the budget has managed to address some of the key issues around Atmanirbhar Bharat, education and Digital India.
"With the PLI scheme announced along with the increased focus on 'Make in India' in this budget, we are confident that it will encourage local manufacturing, and further bolster the local PC market," Agarwal added.
The budget introduced some ease of doing business measures ranging from taxation to investment to help boost the country's economic activities and ensure job creation.
Nasscom said that while there have been steps taken such as incentivising incorporation of one-person companies and the extension of claiming tax holidays and capital gains for one more year, "this was a perfect opportunity to do something disruptive for the sector, like extending the available tax holiday of three years to all startups registered under DPIIT, which would impact over 40,000 startups in the country”.
“For the IT sector, one of the biggest needs ahead of us is the development of future business models, with hybrid working becoming a reality. We look forward for the government to provide clarity on providing a framework in direct taxes and indirect taxes for the industry to adopt WFH/remote working on a long-term basis. Secondly, we require WFH to be enabled in SEZs on a long-term basis,” it added.
The plan to set up a world-class fintech hub and the allocation of Rs 1,500 crore to provide financial incentives for digital payments are certainly positive steps towards realising a cashless economy, Nasscom said.
The IT industry's apex body suggested a bold policy concerning the Special Economic Zones (SEZs). "The tax holiday for new units has ended in March 2020. The government has provided 15 per cent tax rate to attract new manufacturing. We have suggested this same 15 per cent tax rate be offered to IT-ITES companies in SEZs subject to some employment and investment criteria," it said.
Hari Om Rai, CMD, Lava International Limited, said that the 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," Rai added.
With IANS inputs