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Nasscom lauds budget's thrust on SMEs, start-ups

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Access to funds through easing restrictive conditions of listing on the SME Exchange will facilitate investments for innovative and young start-ups

BANGALORE, INDIA: The focus on small and medium enterprises (SMEs) and start-ups in the union budget for 2013-14 would help boost entrepreneurship across the country, the Indian IT industry representative body Nasscom said Thursday.

"Angel investing is critical for the country and recommendations on structuring through regulator Sebi (Securities Exchange Board of India) and providing pass through benefits is a step in right direction," Nasscom president Som Mittal said in a statement here.

The National Association of Software and Services Companies (Nasscom), however, sought amendment to section 56 of the Income Tax Act, 1961, to make the pass through benefit applicable to investments above Rs.5 crore.

"We will work with the regulator and the Indian Angel Network to take this forward," Mittal said.

Access to funds through easing restrictive conditions of listing on the SME Exchange will facilitate investments for innovative and young start-ups.

"Encouraging innovations for the common man through the National Innovation Council will support younger firms to build technologies relevant for the country," Mittal said.

Noting that allowing CSR (corporate social responsibility) contribution to technology incubators in academic institutions would enable innovation,he said incubation was at a tipping point in the country and a policy environment would provide the right ecosystem for entrepreneurship.

"We hope this incentive will be extended to all incubators registered with DST (department of science & technology) and MSME (micro, small and medium enterprises)," he observed.

Terming the budget proposals as "responsible and reasonable" for balancing growth and inclusion, Mittal said despite constraints under which the economy was going through and the global recovery being tepid, Finance Minister P. Chidambaram had affirmed that doing business in India must be seen as easy, friendly and mutually beneficial.

"We had represented to the government the need for facilitating ease of doing business in India. In this context, we expect the ensuing foreign trade policy (to be announced in April) will provide thrust on boosting exports and also address specific issues pertaining to the IT industry," he said.

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