Finance Minister Piyush Goyal on Friday laid special emphasis on technology and digitization, which forms the backbone of growth and development in fast-growing economies like India.
Without making any direct comments, Goyal outlined the government’s plan that would boost the prospects of India’s technology space.
Promotion of Artificial intelligence
The finance minister, in his interim Budget speech, said the government will soon set up a national center for
artificial intelligence (AI) and nine priority areas will be identified for the AI hubs across India.
According to Goyal, the vision is to take AI and emerging technologies to the people and for that a National Program on Artificial Intelligence has been envisaged by the government.
"The highlight of the budget was the announcement of the a National Center for Artificial Intelligence and the AI portal. This will play a key role for India to accelerate AI development and adoption to the last mile. We look forward to partner with the government for this key initiative," IT industry industry lobby group Nasscom said in a statement.
Impact: The move not only outlines the importance of next generation technologies by the government but also bridges a key gap of skill development that next generation IT needs.
India, as a nation, has not been on the forefront of next generation ground breaking technology and the government’s move has the potential to be a Launchpad for that, provided it is implemented in a timely manner with the right participation of tech companies and startups.
“New scheme on AI is a futuristic scheme which may promote use of technology and digitalization;” said Gulzar Didwania, director at Deloitte India.
Companies likely to be impacted: The move, if carried out in the right spirit, will impact most IT companies like TCS, Infosys, Wipro, HCL Tech and other mid-cap and small-cap software firms. Since the focus will be skills and infrastructure development, the biggest beneficiaries would be startups with special focus on AI. Digital India
The government also announced its plan to create 1 lakh digital villages in the next five years.
DigiGaon or Digital Village is conceptualised as a connected village where citizens can avail various e-services of the Central government, state governments and private players.
The finance minister said that India has made significant progress in delivery of mobile data services and that the cost of data and voice calls in India is now possibly the lowest in the world.
Impact: While it’s still unclear as to how the digital village move will impact the economy, the development is seen positive for telecom companies, which will provide connectivity and select IT companies responsible for technology infrastructure. Companies likely to be impacted: Reliance Jio, Bharti Airtel, Vodafone Idea amongst telecom companies & IT services companies. Path Breaking Tech Initiative To Be Set Up
The FM emphasized on the importance of simplifying tax processes and procedures. For this, the government plans to set up a system, where all returns will be processed in 24 hours while refunds will be processed simultaneously.
The government said the tax returns will be done via a anonymized system that'll be installed in a back office, which will be monitored by people with specialized tax knowledge.
This, according to Goyal, will cut out the middle men and reduce over-vigilance and stringent norms.
Impact: A back office doesn’t necessarily mean a call center. It broadly refers to a completely digitized portal with end-to-end tech, infrastructure, analytics as well as back office capability. Companies likely to be impacted: All IT services firms with end-to-end tech capabilities. Digitization Of Export And Import Transactions
Goyal also spoke about complete digitization of export and import transactions to simply processes.
Impact: Its unclear how the framework will work but if a new digital system has to be set up then the impact would be directly on IT companies specializing in financial services and taxation. Companies likely to be impacted: Most large cap IT services companies and select startups.
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