Budget 2023 | A right step towards digital innovation, growth

The Union Budget 2023-24 delivers necessary impetus to all the sectors ranging from agriculture to education, tourism, skill development, economic boost, and adds simplification to processes to enhance ease of doing business and investment opportunities amidst India’s G20 presidency this year.

The Budget keeps technology at the heart of many schemes introduced this year, with the vision of a technology-driven, knowledge-based economy with robust financial infrastructure, that will support India during a global slowdown. The Budget focuses on socio-economic development with an impetus on economic empowerment of women through supporting policies which scale up their business operation, upskilling of youth under PM Kaushal Vikas Yojna 4.0 through establishing 30 Skill India international centres adding course for modern technologies, and help MSMEs and startups through easing the compliance mechanism.

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All these measures will be crucial to ensure greater employment, digital inclusion, and promote entrepreneurship opportunities for different strata of society.

Focus On Technology Sector

Looking at tech, greater impetus has been given to agri-tech, Artificial Intelligence, 5G, and FinTech. The proposal for creation of digital public infrastructure for agriculture as an open source and interoperable public good is going to immensely support the farmers, and incentivise the startups to innovate. Further, the agriculture accelerator fund will incentivise more startups to invest in agri-tech solutions through modern technologies, and will also promote investment in this sector.

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The establishment of Centres of Excellence on Artificial Intelligence will help in-house development of AI solutions for health, agriculture, and sustainable cities. This Budget expands the scope of documents available in DigiLocker for the use by fintech services. This platform is accessed by 146 million individuals and has issued 5.6 billion documents. This expanded scope will help fintech services to easily access more documents which are required to help them innovate and facilitate ease in interacting with users. This coupled with the proposed simplification of KYC processes would immensely help the fintech ecosystem. Further, the establishment of 100 labs for developing applications for 5G services indicates the push to enable India to emerge as a hub of 5G technologies in the future. It will help in testing, analysing, and subsequently deploy a range of applications to drive 5G in India.

The budget further enables access to anonymised data for startups and academia through the National Data Governance Framework. However, before such access is given, appropriate mechanisms and safeguards should be put in place to prevent any deanonymisation attempts. In a significant step, the Budget also proposes the establishment of data embassies which essentially means that India will facilitate data continuity solutions for other countries. This would help enable trust and show technical capabilities to other countries and convince them to transfer public data to India. Another focus is given to e-courts which could facilitate easier and swift access to justice.

For MSMEs And Startups

The Budget has several policies measures which will help MSMEs and startups, such as ease in compliance burden and repayment of amount in cases of contract failure during the Covid-19 period, and importantly, the establishment of Entity DigiLocker for MSMEs, which will act as a one-stop solution for navigating through various authorities, regulators, banks, and other business entities.

Maximising The Opportunity

While the steps taken in Budget 2023 are laudatory, there is also a need to ensure that these schemes work coherently with the evolving regulatory and policy landscape. The Data Protection legislation is under consideration and the government is also working actively towards updating the IT Act. These measures will play a significant role in providing direction to our digital expansion goals and ensuring optimum benefits for all the stakeholders involved. Accordingly, it will be critical that the budgetary schemes are complemented by appropriate regulatory and policy interventions to optimise maximum benefits and ensure last mile delivery.

Kazim Rizvi is Founding Director, The Dialogue.

(Disclaimer: The views expressed are the author's own. They do not necessarily reflect the views of DH.)