Budget ‘23- For entrepreneurs
The Indian government has once again shown its commitment to supporting startups in the country with its latest budget proposal. Finance Minister Nirmala Sitharaman has proposed extending the period of incorporation for eligible startups by a year, until March 31, 2024, and has also proposed easing norms by extending the benefit of carrying forward losses to 10 years.
The government’s continued support of startups is part of the Startup India initiative, which was launched in January 2016 to build a robust ecosystem for innovation and private investment. The Fund of Funds for Startups (FFS), Startup India Seed Fund Scheme (SISFS) and Credit Guarantee Scheme for Startups (CGSS) are all implemented to provide capital at various stages of a startup’s business cycle.
This year’s budget has not only incentivized startups but also the MSME sector. Jatin Kanabar, Partner at Deloitte India, praised the budget for its “welcome provisions”, including the extension of the date of incorporation for the tax holiday, relaxation of carry forward of losses, and enhanced limit for the presumptive tax regime.
The budget also focuses on technologies such as 5G and fintech, as well as agritech. The government is setting up an agriculture accelerator fund to support agri-startups in rural areas and an agriculture-focused digital public infrastructure. The government is also looking to tap into the 5G network for different sectors and will set up 100 labs to develop 5G apps.
Artificial intelligence also finds a place in the budget, with the government planning to set up three centres of excellence for AI. The Make AI in India campaign will see top industry players partnering to conduct interdisciplinary research and develop cutting-edge applications.
The government has also announced the national data governance policy, which will share anonymous data with researchers and academia. The scope of DigiLocker, a citizen’s digital document wallet, is also being extended to assist innovation in the fintech industry.
In conclusion, the Indian government’s latest budget proposal is a testament to its commitment to supporting startups and innovation in the country. The extension of the period of incorporation and the easing of norms for startups, as well as the focus on technologies and agritech, will provide a much-needed boost to the startup ecosystem in India.
