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Saptarshi For India’s Glorious Future

2 Feb 2023 , 10:59 AM

Key Highlights:

  • Boost to Capital investment Outlay for 3rd year in a row with inclusive development through universalization of schemes;
  • The rapidly expanding tech-savvy population and large pool of engineering and data science talent are driving growth in the AI industry in India;
  • Leveraging technology, promoting hands-on learning, and preparing teachers & students for the demands of the 21st-century workforce
  • Supporting modern technologies to transform agricultural practices, increase productivity and profitability.
  • The Indian pharmaceutical industry is currently poised to become a major contributor to medical research;
  • MSMEs will become eligible for accessing additional collateral-free guaranteed credit only if a large banks and financial institutions makes available the capability to implement the S.T.A.I.R. methodology;
  • A tax payer friendly budget, especially for the middle class.

The Saptarshis are:

  1. Inclusive development
  2. Reaching the last mile
  3. Infrastructure & Investment
  4. Unleashing the potential
  5. Green Growth
  6. Youth Power
  7. Financial Sector

The Indian economy is projected to grow exponentially in the coming years, with positive indicators such as increasing foreign investment, growth in key sectors such as manufacturing and digital technology, and reforms aimed at improving business conditions. However, there are also challenges such as unrealised potential and demographic dividend which could impact growth. A balanced and well-coordinated approach to addressing these challenges will be important for sustained economic growth in the future.

Artificial Intelligence

Artificial Intelligence (“AI”) is a rapidly growing field in India, with significant potential for innovation and economic growth. The government has recognized AI's potential and has taken steps to promote its development, including the launch of a national AI strategy and the establishment of AI research centres. The Budget has proposed for the setting up of three centres of excellence for Artificial Intelligence in top educational institutions for realizing the vision of “Make AI in India and Make AI work for India”. Leading industry players will partner in conducting interdisciplinary research, develop cutting-edge applications and scalable problem solutions in the areas of agriculture, health, and sustainable cities. This will galvanize an effective AI ecosystem and nurture quality human resources in the field. 

The private sector is also investing heavily in AI, with Indian companies and startup developing innovative AI-powered products and services across a range of industries. The rapidly expanding tech-savvy population and a large pool of engineering and data science talent are driving growth in the AI industry in India. 

Digital India is built on the India stack on the back of which a world altering Digital Public infrastructure (“DPI’s”) and digital private goods (“DPG’s”) are being built using converging exponential technologies for education, agriculture and health care.

Education:

The future of education in India looks promising, with a focus on leveraging technology to enhance the learning experience and improve access to quality education. The government is investing in initiatives aimed at promoting digital literacy and incorporating technology into the classroom, such as the National Digital Library and the Digital India initiative. Several programs, aimed at improving the quality of education, such as the Sarva Shiksha Abhiyan for universal elementary education and the Right to Education Act have also been successfully launched.

Teacher training is set to be re-envisioned through innovative pedagogy, curriculum transaction, continuous professional development, dipstick surveys, and ICT implementation as proposed in the Budget. The District Institutes of Education and Training will be developed as vibrant institutes of excellence for this purpose. In addition, a National Digital Library for children and adolescents will be set-up for facilitating availability of quality books across geographies, languages, genres and levels, and device agnostic accessibility. States will be encouraged to set up physical libraries for them at panchayat and ward levels and provide infrastructure for accessing the National Digital Library resources. 

The focus of the Budget is on leveraging technology, promoting hands-on learning, and preparing teachers & students for the demands of the 21st-century workforce. This continued investment and commitment to reform, shall catapult the Indian education system to becoming a global leader in delivering high quality accessible education to all.

Agriculture:

Agriculture in India is likely to be influenced by several factors including advancements in technology, changes in government policies, and shifting consumer preferences. There is potential for increased adoption of precision agriculture and use of technology such as drones and satellite imaging to improve crop yields. The government is also likely to continue investing in infrastructure and support for the agriculture sector, particularly for small and marginal farmers. There may also be a growing demand for organic and sustainable agriculture practices, driven by consumer awareness and health concerns. Additionally, the increasing population and rising incomes may drive further growth in the agriculture sector.

The proposition for setting up a digital public infrastructure for agriculture which will be built as an open source, open standard and inter operable public good is just the push required to take the agriculture revolution forward. This will enable inclusive, farmer-centric solutions through relevant information services for crop planning and health, improved access to farm inputs and support for growth of agri-tech industry and start-ups. 

The setting up of an Agriculture Accelerator Fund will inspire young entrepreneurs in rural areas to bring about innovative and affordable solutions for challenges faced by farmers. It will also bring in modern technologies to transform agricultural practices, increase productivity and profitability.

India is the largest producer and exporter of millets or “Shree Anna” in the world, with a production of over 20 million tonnes annually. The classification of the Indian Institute of Millet Research as the Centre of Excellence for sharing best practices, research and technologies at the international level, will assist in meeting the demands of consumers who are seeking healthy and sustainable food options across the globe.

Health Care

Medical research has been making significant progress in recent years, with a growing focus on developing innovative solutions to health problems in India and around the world. The Indian government has increased investment in medical research and has taken steps to encourage innovation in the sector, including the establishment of research institutions and programs to support young scientists. The budget has proposed setting up of facilities in select Indian Council of Medical Research (“ICMR”) Labs which will be made available for research by public and private medical college faculty and private sector R&D teams for encouraging collaborative research and innovation. New programmes to promote research and innovation in pharmaceuticals will be taken up through centers of excellence. Further, dedicated multidisciplinary courses for medical devices will be supported in existing institutions to ensure availability of skilled manpower for futuristic medical technologies, high-end manufacturing and research.

The Indian pharmaceutical industry is currently poised to become a major contributor to medical research, with many leading Indian drug makers investing heavily in R&D. Additionally, India's large pool of talented scientists and medical professionals, combined with its huge patient population, make it an attractive location for clinical trials and other types of medical research. 

MSME’s

Micro, Small, and Medium Enterprises (MSME’s) play a crucial role in the Indian economy, contributing to approximately 45% of the country's industrial output and employing around 120 million people. The government has implemented several policies and programs to support the growth of MSMEs, such as the Micro, Small, and Medium Enterprises Development (MSMED) Act, which provides a legal framework for the promotion and development of MSMEs, and the National Small Industries Corporation (NSIC), which provides technical, financial, and marketing support to MSMEs. In recent years, various initiatives to encourage digital adoption and technological innovation among MSMEs, such as the 'Digital India' and 'Make in India' programs, aim to increase the competitiveness of MSMEs and improve their access to markets and capital.

The credit guarantee scheme for MSMEs which will take effect from April 01, 2023 through infusion of INR 9,000 crore in the corpus and will enable additional collateral-free guaranteed credit of INR 2 lakh crore, will assist MSMEs to tackle several challenges, such as limited access to credit and poor infrastructure. Further, the cost of the credit will be reduced by about 1 per cent. The private sector will also need to continue to invest in programs and initiatives aimed at improving the competitiveness and resilience of MSMEs.

MSMEs will become eligible for accessing this INR 2 lakh crore facility only if a large bank, like the State Bank of India (“SBI”), makes available to the sector the capability to implement the S.T.A.I.R. methodology described below:

On the compliance front, the increase in benefit of presumptive taxation limit to INR 3 crores to the tax payers whose cash receipts are no more than 5 per cent, will ease complications in order for them to focus on expansion. Extending the date of incorporation for income tax benefits to start-ups from March 31, 2023 to March 31, 2024 and providing the benefit of carry forward of losses on change of shareholding of start-ups from 7 years of incorporation to 10 years, is a great move.

Tax Reforms

The push for adoption of the new tax regime by increasing the rebate limit to INR 7 lakhs, removing the exemptions and raising the base tax slab to above INR 3 lakhs points towards a tax payer friendly approach, especially for the middle class. The reduction in surcharge from 37% to 25% under the new regime has stirred the interest of the high-net-worth individuals as well.

These along with other taxpayer friendly reforms will support the government in achieving the mammoth task of having all Income Tax returns processed within one month of the deadline. The move towards straightforward return forms which require less data input and more data approval will facilitate more individuals to file their returns. 

To ensure quick redressal of taxpayer grievances and reduce the pendency of appeals at Commissioner level, the deployment of about 100 Joint Commissioners for disposal of small appeals is truly a blessing in disguise. The cautious selection approach in taking up cases for scrutiny of returns already received in the current year will help reduce workload for all parties involved.

Conclusion:

The first budget of Amrit Kaal is likely to be a budget which will give India the ability to grow its GDP @ of USD 1 trillion every year.

Rishit Thakker
Shailesh Haribhakti

Related Tags

  • Union Budget
  • Union Budget 2023-2024
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