Union Budget 2023: Big push for AI and 5G

The government’s announcement around setting up AI CoE and app development labs have been applauded by the industry

The setting-up of three centres of excellence (CoE) for artificial intelligence in leading academic institutions and the establishment of 100 labs for developing apps using 5G services in engineering colleges are the major highlights.

Nirmala Sitharaman, the finance minister of India, presented the final, comprehensive budget of the PM Narendra Modi administration this week.

The budget includes initiatives to spur technology-driven, rapid change ecosystem.

The setting-up of three centres of excellence (CoE) for artificial intelligence in leading academic institutions and the establishment of 100 labs for developing apps using 5G services in engineering colleges were the announcements that received the most praise from the tech community.

AI CoE and 5G labs

The AI CoE will see leading industry players partner in conducting interdisciplinary research, develop cutting-edge applications and scalable problem solutions in the areas of agriculture, health, and sustainable cities. The move has been taken to further strengthen an effective AI ecosystem and nurture quality human resources in the field.

In addition, the government announced that it will set-up one hundred labs for developing applications using 5G services in engineering institutions to realise a new range of opportunities, business models, and employment potential. The labs will cover, among others, applications such as smart classrooms, precision farming, intelligent transport systems, and health care applications.

“The budget has done well to provide for innovation in the areas of AI, Materials, 5G through CoEs and for developing and enhancing the digital talent pool in the country. This will help fully realize our demographic dividend, specifically towards preparing youth for international opportunities and taking the skilling to last mile through setting up of 30 Skill India International Centres across states. At IBM, we appreciate the Government’s endeavours in strengthening the emerging technology ecosystem and we are confident that the Government’s proposal to set up 100 labs across engineering institutions to develop applications for 5G services will go a long way in developing cutting edge ICT services in India, for India and for the world,” says Sandip Patel, Managing Director, IBM India/South Asia.

“From the government’s announcement of setting up of 100 5G labs and the development of 3 Centers of Excellence for AI, all of these will go a long way in unleashing the digital potential of the country. In a world that is driven by data and AI, we see numerous and infinite opportunities ahead of us,” says Puneet Gupta, vice president & managing director, NetApp India/SAARC.

According to the industry experts, this move will pave the way for tech-enabled growth in the country. “From strengthening India’s prowess in technology and AI and being future ready to truly unleashing the potential of 5G, the budget is holistic in its approach and will certainly pave the way for tech-enabled growth for the country in the coming years. Coupled with strategic focus on building infrastructure and connectivity in sectors including transportation and aviation will have a significant impact in making India a more agile economy, and in making the daily lives of citizens more convenient and efficient," says Aalok Kumar, President and CEO, NEC Corporation India.

Talking about the government’s vision for the growth of AI and technology, Santhosh Sagar Reddy, Founder and CEO of CoffeeBeans, a technology company that helps businesses build superior products, stated that, “It is heartening to witness that the FM has proposed a two-pronged vision for artificial intelligence (AI) in India: 'Make AI for India' and 'Make AI work for India'. The game-changing potential of AI is very much evident today and now with Budget 2023 proposing setting up three centres of Excellence for AI in top educational institutions, I am quite confident that the technology will herald a new wave of growth across business sectors and industries.  Further, the fact that these centres will work in close collaboration with industry and encourage multidisciplinary research is sure to help both the tech industry and the country to realise its true potential in the coming years.”

Some of the other key announcements include:

Skill India Digital Platform

The digital ecosystem for skilling will be further expanded with the launch of a unified Skill India Digital platform for:

  • Enabling demand-based formal skilling
  • Linking with employers including MSMEs, and
  • Facilitating access to entrepreneurship schemes.

This platform will emphasise formal skill development in line with market demands, offer access to entrepreneurial programmes, and connect job seekers with employers—including MSMEs. In addition, thirty Skill India International Centres will be established nationwide to help with the digital platform's preparation of the younger generation for careers abroad. "Initiatives such as the Skill India Digital platform, which provides training in cutting-edge technologies and soft skills, are commendable as the youth need to upskill to succeed in the rapidly changing job market.  This investment in human capital is critical to ensure that India remains competitive and well-positioned for future growth," says, Rajesh Ganesan, President, ManageEngine.

Industry experts feel that the 'Make AI in India' and 'Unified Skill India Digital Platform' training and skilling efforts are anticipated to produce a highly skilled workforce that will greatly accelerate country's economic growth.

“The Unified Skill India Digital Platform would facilitate demand-based formal skilling, employer linkage (including MSMEs). Revamped credit guarantee scheme for MSMEs to infuse Rs. 9000 crores into the corpus. The budget has brought about entrepreneur-friendly measures on the policy and legal fronts to drive operational excellence across sectors. Access to entrepreneurial initiatives to further bolster the economic and human resource foundation of the country will drive start-up ecosystem in the country,” says Rahul Garg, Founder & CEO, Moglix & Credlix.

National Data Governance Policy

To unleash innovation and research by start-ups and academia, a National Data Governance Policy will be brought out. This will enable access to anonymized data to startups.

According to the draft policy, the move aims to ensure greater citizen awareness, participation, and engagement with open data, increase the availability of datasets of national importance, and identify datasets suitable for sharing and improve overall compliance to secure data sharing and privacy policies and standards.

“The proposal to introduce the National Data Governance Policy for access to anonymized data will be a boon to the startup sector, and it will facilitate a lot of value creation for customers as well as businesses. Furthermore, proactive measures in areas of tax benefits and offsetting losses are welcome moves,” says Dhaval Thanki, Vice President, APAC & MEA, LogiNext.

Digilocker services

The government has improved the Digilocker services, enabling more document uploads from individuals, micro, small, and medium-sized businesses, and nonprofit organisations. A new one stop solution, utilising DigiLocker and Aadhaar, will be built for reconciling and updating the identity and address of persons stored by multiple government agencies, regulators, and regulated enterprises.

“A robust financial sector, expanding the scope of Digilocker to allow more documents to be made available and setting up of e-courts will all go hand in hand with maintaining data privacy. There simply cannot be any data privacy without data protection and cybersecurity will require an entire system of people and technology working together to protect data and networks,” says Vishak Raman, Vice President of Sales, India, SAARC and Southeast Asia at Fortinet.

Commenting on the overall budget from tech standpoint, Achal Kothari, Co-founder & VP - Business, ByteBeam- Iot device management Company- Startup states, “The 2023 Budget lays out a clear vision for India’s future with a focus on physical infrastructure, such as roads and rails, and investment in new technologies like AI to spur economic growth. The move to exempt raw materials for Li-ion battery manufacturing and emphasis on reducing carbon emissions is a strong signal that the government is committed to promoting sustainable technologies like electric vehicles. This budget is poised to drive the accelerated adoption of EVs and related technologies like chips, connectivity modules, and TCUs.”

Pradhan Mantri Kaushal Vikas Yojana 4.0
The government has announced the introduction of Pradhan Mantri Kaushal Vikas Yojana 4.0 to address the challenges of job creation. The programme will place a strong emphasis on on-the-job training, industry partnerships, and course alignment with industry demands. As part of Industry 4.0, it will also feature cutting-edge courses in coding, artificial intelligence, robotics, mechatronics, IOT, 3D printing, drones, and soft skills. 
"The government’s decision to formulate the National Education Policy, focused on skilling will facilitate job creation at scale. The digital ecosystem for skilling will be further expanded with the launch of a unified Skill India Digital platform for enabling demand-based formal skilling. The proposed Pradhan Mantri Kaushal Vikas Yojana 4.0 meant for skilling youth shall entail new age courses for Industry 4.0 like coding, AI, robotics, soft skills etc. It is a great incentive keeping in mind the importance of skilling, upskilling and reskilling in the present scenario. Another emerging technology today is Artificial Intelligence. The three proposed centres of excellence for Artificial Intelligence too is a good opportunity for industry players to partner in interdisciplinary research, develop cutting-edge applications and scalable problem solutions.  These initiatives will pave the way for building a workforce that will be skilled and ahead of the curve in their respective industry,” says Nitin Varma, Managing Director, India & SAARC, CrowdStrike.
"Amid shrinking budgets and an economic downturn, businesses are increasingly having to do more with less and the importance of Artificial Intelligence in a time like this cannot be overstated. The Union Budget’s focus on ‘Make AI work in India’ is a much needed move to develop more skilled talent in the AI field and set new standards for India’s growth. Our recent CX Trends Report revealed a gap between consumer expectations and business priorities - 84% of Indian consumers expect AI interactions to become more natural and human-like over time, but less than half of Indian businesses (45%) plan to invest in such technologies in the next 12 months when it comes to their customer experience. The government’s move will accelerate the development of India’s AI ecosystem, especially at a time when businesses - particularly MSMEs - face budget constraints when making strategic investments into technology. The Rs 9,000 crore corpus fund and tax concessions made for this sector in the budget will help boost tech adoption among small businesses, and accelerate progress towards a Digital India,” says Vasudeva Rao Munnaluri, RVP India & SAARC, Zendesk.

Add new comment