As Narendra Modi led NDA Government came out its first general budget, reactions have been flowing in from who's who of the IT industry.
Let's take a look on what they have to say on General Budget, 2014:
"The increase in investment limits in FDI announced in the 2014 budget will favorably impact the economy. Significant encouragement has been provided to domestic manufacturing that will likely enhance both local production and employment, especially in the sectors of retail and e-commerce. Measures on tax reforms like advance rulings, tax settlement mechanisms and APA ( advance pricing agreements ) etc. will contribute to improving investors' confidence and removing uncertainty regarding taxation. The introduction of inter-quartile range in transfer pricing as well as the set up of a committee to evaluate retrospective taxation are the positive steps. Outlays for improving infrastructure in ports, roads, airports, Smart Cities as well as education related initiatives and the funding model resonate well with the country's growth plans"
BD Park, President & CEO, Samsung India
“The Modi government’s Budget for the year is positive, encouraging, and includes some much-needed reforms. With a strong focus on infrastructure, connectivity and with the rollout of GST, the FM has given a boost to the economy’s growth momentum, making it easier for businesses to operate. The reduction in Income Tax for the salaried comes as a relief, with a resultant rise in disposable income, encouraging IT purchases. For indigenous manufacturers, the Budget has aptly addressed the issue of inverted duty structure, thus enhancing local manufacturing. Furthermore, with a boost given to e-governance, and the focus on broadband penetration, the Budget has adequately harnessed technology to propel future growth. Overall, this year’s Budget is optimistic and welcome, and it will be interesting to see how this plays out”
Amar Babu, Managing Director, Lenovo India
“We are optimistic that the union budget will make room for changes on the policy level to enable greater participation and contribution from the industry. Making provisions for greater IT adoption in the government, manufacturing and private sector through incentivization, and streamlining the procurement process for technology products and services will be crucial. Changes in income tax laws like discarding MAT on SEZ income, minimizing litigation on export turnover, and addressing royalty implication on software, both retrospective and on services, are also important. We expect that the budget will support the growth of entrepreneurship & innovation amongst Indian technology companies. The government should support the repositioning of India as an Innovation Hub and plan investment in rebranding and repositioning. Incentivizing expansion to Tier 2/3 cities, and supporting market development initiatives abroad for Indian technology products & services will help drive opportunities for balanced growth, employment, and improving overall competitiveness”
Krishnakumar Natarajan, CEO & Managing Director, Mindtree
“A promising budget with initiatives to enhance connectivity by building infrastructure to bridge the gap between rural and urban India. The smart cities and digital India programme of the government will ultimately create an economic value for the country by aiming to increase employability and reducing immigration. Good to see empowerment of the rural areas for businesses to flourish for a speedy economic growth. The measures to boost domestic manufacturing sectors, revive SEZs, support start-ups and set up new industrial clusters are all initiatives towards creating a progressive and advanced India”
Edgar Dias, Regional Director, India at Brocade
“For a Government that is just 45 days old, I will say it’s a job well done. This budget has given us visibility on intent and direction. The Government has been very practical in ensuring continuity and making some socially important schemes productive. Secondly, they acknowledge that banks need to be capitalised on priority without which, industry credit needs cannot be met. There is a huge emphasis all through the budget proposals on PPP. Effective governance will result in successful PPP facilitated infrastructure growth. This might also give an impetus to the Smart Cities plan; because eventually these cities would require utilities and connectivity. There might be a hidden gem in the Rs.10000 crores for venture capitalist fund for encouraging start-ups, a fantastic push for entrepreneurship. The fiscal deficit of below 3% for next year is highly welcome. The discipline here is to ensure effective government expenditure”
M P Vijay Kumar, CFO, Sify Technologies
“This is a progressive budget with a clear business focus. The priority that the government gives to the renewable energy sector is commendable. This should give solar manufacturers an opportunity to aspire to leadership by providing differentiated, technologically advanced and competitive offerings. Both the government and the industries should also commit to focusing more on R&D in this area – and build a sustainable solar and ESDM ecosystem in India.Although specifics were not mentioned, the emphasis on electronics and manufacturing in the speech is encouraging. We are confident that the government will support the development of the ESDM ecosystem in India and move us toward attaining self-reliance in manufacturing, and building investor confidence in the country"
Aninda Moitra, President & Managing Director, Applied Materials India
“This morning’s special mention of the Software Product Industry (SPI) by the Union Finance Minister is certainly noteworthy because it will certainly be instrumental in branding Indian innovation and taking it to the next level by encouraging this nascent industry that largely comprises start-ups”
Naveen Tewari, CEO, InMobi
“SPI is an enabler for many other industries like Defense, Electronics and Communications. Naturally, a healthy software product industry brings endless possibilities to the country prime among them employment. The creation of 100,000 Software Product Companies in India will lead to the creation of $500+ billion in market value in a decade and the upliftment of more than 30 million SMEs"
Bharat Goenka, Tally Solutions & Co-Founder, iSPIRT
“Overall I would view this budget to have a positive push to industries across the board and augurs well for IT industry as well. This budget focuses clearly on growth, development and job creation with particular focus on infusing growth in manufacturing and infrastructure sectors. From industry perspective, the policies that would have major positive impact on the domestic IT uptake are: ‘Digital India’ program; “Good Governance”; and “one hundred smart cities” program. Also, FDI cap increase in defense and insurance sector is a huge positive and has direct bearing on IT industry. This budget has also set aside funding for adding new top-notch educational institutions such as the IITs and IIMs in various cities, which is likely to have a long term impact on generating technical and management talent. Lastly the focus on micro and small and medium sized businesses and their enablement/empowerment with various schemes is a huge positive and is likely to have positive impact on the IT industry as well as such companies get empowered to resort to technology. The orientation towards growth across sectors augurs well for the domestic IT industry however things more or less remain ‘status quo’ from offshore or exports perspective as there is no change in the position there. One area where we would have expected some concrete decision taken would be retrospective taxes and the position thereof. But overall, this is a balanced growth oriented budget with focus on accelerating on the fundamentals”
Arup Roy, Research Director, Gartner India