Indian technology industries stalwarts today gathered at the Raisina Hills for a first ever pre-budget meet with the Finance Minster Arun Jaitley.
Captains of Indian software firms such as Vishal Sikka, CEO, Infosys, Suresh Senapathy, CFO Wipro, Pheroz Vandrewala, executive VP, TCS, Anil Chanana, CFO HCL, R Chandrasekhar president of Nasscom along with e-commerce captains Sachin Bansal of Flipkart, Kunal Behl of Snapdeal, Naveen Tewari of InMobi and several others came together for this meet.
“This is for the first time that the finance ministry exclusively had a pre-budget meeting with the IT industry. This shows the important of the industry in not only as a contributors of foreign exchange and the largest hirer in private sector but also the fact that today we as a industry have become central to the economy,” said R Chandrasekhar, president, Nasscom.
Major suggestions include incentives for setting-up of data centers within the country. It was said there is a need to give tax incentives for building infrastructure for large data centers and cloud services within the country to ensure data security as well as to have a big network of large software products companies within the country.
Industry players unanimously asked the FM to create a favourable eco-system for entrepreneurs, small and medium enterprises (SMEs) and large MNCs to flourish in India. Both Naveen Tewari of InMobi and Sachin Bansal said that they received several offers from other countries to set-up their business there and get better business environment.
The SMEs and technology Start-ups need an environment of constant nurturing including access to funds, incentives to support operations and a simplified compliance framework. On the other hand large enterprises require stable policies and predictable regulations to continue its global journey.
“The FM has asked us to get back to the ministry with two things. First, he has asked us to come up with a proper definition of start-up, so that incentives can be targeted. And two, collate and provide recommendation on angel funding in India. He has also asked us to provide details of competitive tax regime for product companies in other countries,” added Chandrasekhar.
Meanwhile FM Arun Jaitley said that the role of IT sector, be it hardware or software, is crucial in order to promote e-governance for empowering citizens. He said that the role of this sector is also important in promoting the inclusive and sustainable growth of the electronics, IT and ITeS industries and enhancing India’s role in internet governance.
“The success of ‘Digital India’ initiative will necessarily rely on the IT/BPM sector for design, deployment and its continued success. Realization of ‘Make in India’ is inseparable from ICT sector. Modern manufacturing relies on IT for efficiencies and innovation leading to ‘know-why’ of products and processes,” said Jaitley.
iSpirt, the think tank representing the software product industry also put forth its recommendation for the industry. They said it is important to exempt software products from all direct and indirect taxes, for – say – a period of five years (till 2020), such that the entire economy gets a major shot in the arm. “iSpirt has made specific recommendations on rationalising direct/indirect taxation and regulations related to SEBI, RBI and Ministry of Company,” said a member of iSpirt.
The industry also insisted that there needs to be changes made to the procurement policy of governments ICT needs. “The prevailing conditions and prerequisites for participating in Government programs are onerous, and not all past experiences have been favourable. There is an outstanding amount of Rs 4,000 crore to 5,000 crore that needs to be addressed. Further, SMEs face stiff barriers in the eligibility criteria related to past experience which need to be revisited,” said Chandrasekhar of Nasscom.