Read on to find out what are the major areas of their expectations of startups catering to different verticals such as fintech, travel, or IoT.
Budget 2016: Earlier this year, Prime Minister Narendra Modi’s ‘Startup India Stand Up’ campaign had managed to lift the spirits of many startups. Hence, the startup community in India is keenly awaiting for the upcoming union budget 2016-17, expecting a healthy tax regime for high-spirited startup ecosystem in India. Read on to find out what are the major areas of their expectations of startups catering to different verticals such as fintech, travel, or IoT.
Startup – Travel Tech
“The current government’s focus in the Indian startup ecosystem is very positive and the union budget 2016 must encourage investment in the Indian startup space. We also need a better definition for online aggregators and their taxation norms in every vertical as India houses over 1000 online aggregators across various verticals. The government had initiated the idea of defining online marketplace recently but not much progress has been seen here till now,” said Aloke Bajpai, CEO & co founder a prominent travel-tech startup Ixigo.
On tourism, he said that India is on a high growth path and with the tourism friendly policies of the new government, we hope to see more and more developments. I strongly think that the government should focus more on infrastructure and develop airports and provide better connectivity to smaller towns leading to even faster growth in the travel sector. “As against to over 4300 operating railway stations, India has only about 130 operating airports — in comparison to 200+ airports of China, which is spending Rs 78,000 crore this year on civil aviation infrastructure. In order to improve facilities available to tourists, the government should also come up with SOPs for infrastructure investments in travel, tourism and hospitality sectors,” Ixigo’s Bajpai added.
Startup – Internet of Things (IoT)
In technology innovation, patents is one the most critical issue of startup. Saurav Kumar, CEO & co founder of a India-based Internet of Things (IoT) startup, Cube26, said that the IoT community expects the government to make patents simpler, and offer schemes and incentives that encourage startups to take risks. “We also expect government to approach India’s smart devices market through supportive and encouraging regulations to expedite the ecosystem for smart device manufacturing,” he added.
On Make in India, Kumar said that the government should offer subsidies on investments and incentives for Indian device manufacturers. “This will help them to build a price advantage over the increasing international competition from brands. Also, reduction of import duties with an option to allow businesses to Make in India will be a welcome move,” he said.
Moreover, he also said that substantial funds should be allocated to develop digital literacy and mobile internet penetration in tier 2, tier 3 cities to achieve the government’s ‘Digital India’ mission.
Startup – Mobile browsers
Kenny Ye, MD of UCWeb India, a key mobile browser startup, said that he is hoping for a definite roadmap for GST implementation in Budget 2016. His key expectations are removal of angel tax, cut in direct and indirect taxes to provide the much-needed impetus for entrepreneurs and push India to become the start-up capital of the world.
“While the current government has announced encouraging initiatives like Startup India, Skills India and Make in India, the centre must look to enhance the technological infrastructure that will help fulfill these dreams and drive IT penetration in the country. Increased access to internet connectivity in rural India and higher mobile internet penetration in tier III & IV cities should be a priority to fill crucial gaps in the internet ecosystem, spur domestic spending and boost economic growth,” said Kenny Ye.
Startup – Finetch
Since our wallets are turning into m-wallet, digital payment firms are solving a problem of financial inclusion in India in a big way. Hence, Finetch startups have high expectations from the union budget 2016-17 for improved digital payments on grassroots level in India.
On these lines, Ashutosh Pande, founder & Chief Innovation officer of PaySe told that the government said in one of its communications to the Payment Council of India that merchants with more than 50% of their transactions done digitally could get a tax rebate or a 1-2% reduction in value-added tax on all electronic transactions.
“Consumers could get some income tax rebates if they showed a certain portion of their net expenses was incurred digitally. A similar initiative was implemented in South Korea and helped transform a predominantly cash nation. Success of the initiative in Korea was driven by the willingness of the government to allow various payment instruments including open, semi-closed and closed pre-paid instruments to be within the gambit of digital payment. A similar policy will help the merchants and consumers overcome the initial inertia”, he asserted.
Startup – Education and Skilling
Anil Sachdev, Founder & CEO of School of Inspired Leadership, expects investments in education and skilling programs to prepare the next generation as the government has a focus on Digital India and startups.
There is urgent need to transform bodies such as AICTE that control inputs such as curriculum and infrastructure and replace them with a body that rates “learning outcomes”. We need to attract private capital into higher education and invite ethical companies to invest and earn reasonable returns and ensure high standards in education. In other words we need to remove all controls and replace them with enabling regulation”, said Sachdev.