Major Highlights of Union Budget 2017-18: Digital India to Cashless India and more

Giving a major thrust to rural India in the Union Budget, the government today allocated over ten thousand crores for the Bharat Net Project to provide Wi-Fi hotspots to more than 150,000 Gram Panchayats. This announcement has the potential to truly democratize digital access and change the cyber landscape in India. Announcement was also made to bring back one crore households out of poverty and making 50,000-gram panchayats poverty free by 2019, besides allocating highest ever funds to rural job scheme MGNRGEA. However, given the track record of governance in India, we can only wait and watch.

We spoke to technology industry leaders to find out more about the announcement and what it means for this important sector.

Digitization post demonetization

Reacting to the budget announcement, Mr. L C Singh, Vice Chairman & CEO (Founder), Nihilent Technologies said, “The Narendra Modi-led National Democratic Alliance government’s budget for 2017-18 has a special emphasis on enabling extensive transparent system of governance with providing more avenues for learning and development, through importance to building a huge digital infrastructure, which clearly indicates a wholehearted commitment to development of rural India.

By providing tax relief in HRA, the finance minister Arun Jaitley has helped the public-at-large. The announcement of 'Transform, Energize and Clean India' is a sincere attempt to focus on transforming the quality of governance, energizing various sections of society - especially the youth - and more importantly, cleaning the system from the age-old diseases of: corruption, black money and non-transparent political funding, which is certainly a welcome move.

Digital India: Bridging the digital divide

In addition to that, the promulgation of digital transactions to the tune of Rs 2,500 crore across various platforms like: UPI, USSD, IMPS, Aadhaar Pay, debit cards, and tax exemptions on digital transaction equipment’s, referral bonus and cash-back not only for customers and merchants as well, in order to promote BHIM app, will not only boost the fast adoption of digital technologies across the country but it will, for sure, encourage means to reach out to consumers digitally and different markets. In a nutshell, it's a balanced and realistic budget.”

According to Mr. Padmanabha Krishnamurthy, CFO, Paladion Networks, "We see a positive and bigger push towards a digital India in the Union Budget for the financial year 2017. Allocation of over ten thousand crores for the Bharat Net Project to provide Wi-Fi hotspots to more than 150,000 Gram Panchayats will truly democratize digital access and the change the cyber landscape in India. We are very pleased to hear about the setting up of a computer emergency response team exclusively for the financial sector, and the payment regulatory board in RBI for monitoring electronic payments. With the aggressive promotion of online payments after demonetization, this is a welcome move and will bolster public confidence in online payments. We look forward to the swift implementation of these technology changes and hope to see a world-class digital economy in India."

Balanced budget

According to MDI Gurgaon spokesperson Prof. Atmanand, the budget overall looks well balanced with focus on areas like Agriculture, Infrastructure, Youth employment and education that need urgent attention.  The focus on Education, Skill Development and Job creation for the youth in India was much needed as large percentage of youth population enter the work force without the requisite skills. After the announcement of Skill India Mission, the focus has been on vocational training. It’s encouraging to see the government’s announcement to set up 100 India international skill centers and a budget of Rs. 2,200 cr set aside for investment in vocational training. It will push the skill India drive in India and help in creating more employment for the skilled youth.

Good for start-up ecosystem

Mr. Amit Rathore, Founder and CEO, Quintype stated, “The Government's continued support to Digital India initiatives indicates clarity of vision and purpose. 2017 is already on its way to being a great year for Digital Media and monetization in particular, as publishers find ways to fight back the Facebook threat, both in terms of revenues & audiences. New digital revenue streams are making new media publishers as much as 100x old models - so on the whole I see a good year for digital, broadband penetration, media consumption on the internet. The Finance Minister's continued focus on using the start-up ecosystem to stimulate growth and create more jobs is encouraging.”

On GST

In the words of Mr. Satya Pramod, CFO, Tally Solution Pvt ltd., the best thing Mr. Jaitley has done is he has not tinkered too much, especially with indirect taxes and has gone with the flow which have made the markets buoyant. Overall, the economy is going in the right direction with a fiscal deficit of 3.2%. In terms of investment, the removal of FIPB and making the procedure simpler will attract foreign investments and facilitate ease of business. From a GST adoption standpoint, it is music to the ears to hear that the GST council has finalized most of the recommendations made to it and the states and center are aligned. Also, not changing the indirect tax rates at this juncture is a clear indication that GST is all set for 1st July. The introduction of GST will further strengthen India’s push for better economic growth. Further to this, the seriousness of the government and the tax administration on compliance, whereby, the time limit for completion of assessments has been reduced from 21 months to 18 months which will subsequently be reduced to 12 months (FY 18-19) is noteworthy. For industries, the carry forward provision of MAT credit to 15 years and the reduction in corporate taxes to 25% from the existing 30% for MSMEs is a welcome move and will give a fillip to this segment. The Digital India mission is also live with the FM going on record to say that India is on the cusp of a digital revolution. This along with the various schemes that were announced in relation to making this revolution a success speaks volumes about the commitment of the government towards this campaign.