Industry leaders in upbeat mood over Union Budget 2014

BANGALORE, INDIA: The business community is welcoming the Union Budget 2014 for further opening up Foreign Direct Investment in various sectors and customs duty exemptions on various goods and funding for start-ups.

Excerpts:

BD Park, President & CEO, Samsung India:

"The increase in investment limits in FDI ( foreign direct investment ) 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 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'sgrowth plans. "

R. Chandrashekhar, President, NASSCOM:

"The announcements on a pan India digital initiative, funding for start-ups, district level incubator network and leveraging technology for good governance are welcome steps. These measures along with the initiatives on skilling, smart cities and ease of business, reflect the thrust on role of technology in Budget 2014".

The proposal to set-up a Rs. 10,000 crore fund for start-ups and entrepreneurs will act as a great booster for the growing start-up landscape and will help drive innovation and solutions for the global as well as the domestic markets. At the same time, a pan-India "Digital India" programme will promote digital inclusion with broadband connectivity up to the village level, thereby enabling improved access to services through IT enabled platforms

Prof N K Goyal, chairman emeritus TEMA:

TEAM and CMAI has welcomed the initiative of NDA Government to impose basic customs duty at 10 per cent on specified telecommunication products that are outside the purview of IT agreement. This has settled a long pending issue.

Arup Roy, Research Director, Gartner India:

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.Prof N K Goyal, chairman emeritus TEMA:

TEAM and CMAI has welcomed the initiative of NDA Government to impose basic customs dudy at 10 per cent on specified telecommunication products that are outside the purview of IT agreement. This has settled a long pending issue.

Mehul Lanvers Shah, Managing Director, HMFI India:

 

The inaugural budget of Modi regime has been keenly awaited at a time when the country's economy needs a strong fillip to set the momentum for high-growth, while staying within the purview of fiscal prudence. The new government's budget bodes well for Indian Industry as it encourages local manufacturing, entrepreneurship and transparent governance to create an investor friendly, stable tax regime with retrospective decisions scrutinized by a high level committee.

The move to enable easy online sales for local manufacturers is a positive step towards developing the sector, and look forward to further measures that will attract investments in the IT/electronics manufacturing arena where India remains much behind China in Global exports. The budget has been a particularly good one for the start-up ecosystem with the Finance Minister announcing a start-up fund of Rs. 10,000 crore and fund allocation worth Rs. 200 crore for young entrepreneurs, in addition to a program for start-up village entrepreneurship & incubation. Whilst a provision has been made for absolving start-up bankruptcies, a fund worth Rs. 200 crore has been allocated to stimulate start-up entrepreneurship as well. Urbanization and development of urban infrastructure through smart cities has also found significant mention and over INR 7000 crore is being allocated for the development of 100 smart cities across the country - this is a huge opportunity for the Indian IT industry to partner with the government in this initiative. Overall, the IT industry can rejoice at a budget that banks on technology intervention for development."