Finance Minister Arun Jaitley’s Union Budget spread cheer among the technology and entrepreneurial community, with the announcement of the Rs 10,000 crore fund to provide equity and soft loans to small and medium scale enterprises including startups. The country’s over $4 billion biotechnology industry is also likely to get a boost with the proposal to scale-up of two existing biotechnology clusters at Bangalore and Faridabad apart from establishing two new clusters in Pune and Kolkata.
The government has recognised the importance of software products for the first time in the Budget and has allocated Rs 500 crore for the same. Jaitley also announced a startup programme for rural youth with a Rs 100 crore allocation. Budget will also provide Rs 200 crore to encourage startups by SC/ST youths. Besides, a Rs 100 crore Technology Development Fund has been created. While acknowledging the role of incubators and accelerators, the minister said that infrastructure for these centres will be provided.
In his Budget speech Jaitley said: “A special focus will be on supporting software products startups. A national rural Internet and technology mission service in villages and training in IT...I have provided a sum of R500 crore for this purpose.” IT industry lobby Nasscom said that the Budget is promising and the implementation of GST will make it easier for startups to do business. It added that with wind-up made easier, entrepreneurs may be less nervous about starting out.
“The large quantity of funds allocated is an indication as to how the government sees this sector, besides a recognition of the importance of innovation in growth. This is a good boost to both investor confidence and entrepreneur confidence,” said Ravi Gururaj, chairman, Nasscom Product Council. He also noted that this was for the first time that software products were ever mentioned in a Budget speech.
Successful serial entrepreneur K Ganesh also welcomed the startup push in the budget and said, “The Rs 10,000 crore fund can spur the much needed new employment creation more than any other initiative. However, implementation will be the key. The government needs to move quickly to back up its plans with a time-bound action plan and view the needs of startups in a holistic manner.” He also suggested that IIMs can be made the nodal implementing agency to ensure fair selection, mentoring and effective disbursement of Rs 10,000 crore fund.
“The emphasis given to startups, entrepreneurship, innovation and incubation is also a