Union Budget earns applauds from IT industry

BANGALORE, INDIA:  After the budget getting over industry experts have given a positive reaction overall, although few loops have been criticized. Few of the big players' reactions are here.

Suresh Senapaty, executive director & chief financial officer, Wipro Limited, said, “The Budget has accorded due regard to technology. While the Budget laid stress in adopting information technology for governance in plugging subsidy leakages and in tax administration, it has also supported technology innovation in Industry by rationalizing tax on royalty. The commitment to fiscal discipline has been pragmatically balanced with flexibility. This Budget has re-started the much-awaited reforms process. The key consideration now will be the rigor of implementation.”

Bhaskar Pramanik, chairman, Microsoft India, said, "The focus on technology as a backbone for government processes and systems is the right approach example GSTN, JAM was stressed.

Focusing on startups and MSMEs

The Government has recognized the need to support startups, and incubators and has
acknowledged that a culture of innovation needs to be fostered. Budgetary allocations
for incubators, a mechanism for supporting self-employment and talent utilization will
allow startups and MSMEs to access the funds and talent, creating new avenues for
growth and employment.

The Finance Minister has focused on the ease of doing business in India. We lookforward to policy moves in the coming year that rationalize and streamline approvals for setting up business that can help investments and boost economic development. I am positive about the reaffirmation of the Government’s commitment towards PPP as a key drive of infrastructure creation. This would provide more opportunities for innovation-led companies to partner in India’s growth.

A simpler tax environment

The Finance Minister has provided a firm timeline for the implementation of GST, and
this will help companies effectively plan for the next year. Deferring GAAR by two
years, and the fact that the Government is looking to implement its provisions
prospectively from 2017, is also a welcome move. It is an indication of the GOI thinking to make tax less adversarial.

The reduction in corporate tax, albeit over the next four years has certainly welcome.
More because it also comes with the reduction of exemptions. Exemptions create
confusion. I welcome the simpler framework the Government is proposing.

There was a mention of removing SAD on components to remove the duty inversion.
This can help local manufacturing of electronic goods as part of the Make for India
initiative.

The reduction in tax on royalties for technical services will help greater technology
adoption in industry and that is welcome."

Amar Babu, president, MAIT, said: “Budget 2015 is a balanced budget that touches upon many areas of infrastructure, universal social security vision, insurance for all, education among others. From an IT industry perspective, it is a mixed bag with the inverted duty structure being finally addressed with the removal of SAD on all components. The removal of customs duty on components and concessional structure of 2% without CENVAT credit are positive steps to encourage tablet manufacturing in India. However it disappoints as no initiatives have been taken to increase PC manufacturing and promote exports. In this budget, we might have missed an opportunity to drive 'Make in India' in computers.”

“Union Budget 2015 is progressive and growth oriented for the ICT hardware industry in India. Appointment of expert committee to draft legislation on pre-existing mechanism is appreciable. The impetus given to domestic manufacturing will meet the challenge ahead,” said, Anwar Shirpurwala, executive director, MAIT.

R. Chandrashekhar, president, NASSCOM said, “Our wishlist for Budget 2015 included three key priorities – policy bottlenecks including ease of business, procurement challenges and nurturing start-ups. Budget 2015 does cover some part of these priorities. However, some concerns remain and we would urge the government to address these issues on priority”.