Budget 2022: Startups, digital ecosystem gets a boost

In a massive boost to the new economy, the Budget has provided a significant impetus to the startup and digital ecosystem that is driving innovation and creating a spate of new jobs. To encourage the growth of deep-tech, digital economy, agri-tech, pharma and climate action, which have been collectively described as ‘sunrise sectors’, the government will promote thematic funds for blended finance with the government share being limited to 20%. The funds will be managed by private fund managers.

“Artificial intelligence, geospatial systems and drones, semiconductor and its ecosystem, space economy, genomics and pharmaceuticals, green energy, and clean mobility systems have immense potential to assist sustainable development at scale and modernise the country. They provide employment opportunities for youth, and make Indian industry more efficient and competitive,” finance minister Nirmala Sitharaman said while presenting the Budget on Tuesday.

To spur investment into startups that garnered more than ₹5.5 lakh crore from venture capital and private equity investors last year, the Budget proposed the establishment of an expert committee that will examine issues impeding the flow of capital and suggest appropriate measures.

“Scaling up this (VC & PE) investment requires a holistic examination of regulatory and other frictions,” Sitharaman said. It has also been proposed to widen the eligible pool of startups for availing tax incentives.

Providing a fillip to the usage of drones, the finance minister announced that use of Kisan drones will be promoted for crop assessment, digitisation of land records, spraying of insecticides and nutrients. Startups will be promoted to facilitate ‘Drone Shakti’ through varied applications and for drone-as-a-service (DrAAS).

The budget also laid emphasis on digital learning. It has been proposed that a Digital Ecosystem for Skilling and Livelihood – the DESH-Stack e-portal – will be launched to empower citizens to skill, reskill or upskill through online training. To equip students with better knowledge, especially those residing in rural areas and belonging to the weaker sections, the Budget proposed development of e-content in all spoken languages. The content will be delivered through internet, mobile phones, television and radio by digital teachers.

A digital university will also be established to provide access to students across the country for world-class quality universal education with personalised learning experience at their doorsteps. “This will be made available in different Indian languages and ICT formats. The best public universities and institutions in the country will collaborate as a network of hub-spokes,” Sitharaman said.

In a first, the Budget also suggested the formation of an AVGC (animation, visual effects, gaming and comic) task force that will recommend ways to realise potential of the sector and build domestic capacity for serving local and global demand.

The Budget also emphasised the use of clean tech. “We will promote a shift to use of public transport in urban areas. This will be complemented by clean tech and governance solutions, special mobility zones with zero fossil-fuel policy and EV vehicles,” Sitharaman said.