Startup’s Reaction on Union Budget 2022

By Srikanth
25 Min Read
Startup's Reaction on Union Budget 2022 1

We welcome the vision outlined in the Union Budget 2022 regarding digital payments and how it can be a key tool towards enabling financial inclusion. The Budget has acknowledged that taking forward the digital banking and fintech innovations is the way to go – it is proposed to set up 75 digital banking units in 75 districts of the country by scheduled commercial banks. We hope to be able to support this mission and vision of financial inclusion by providing secured, transparent and accessible credit to women. Financial inclusion will play a key role in ensuring that the goal of 9.2% economic growth is achieved.

Poshak Agrawal, Co-Founder & CEO, Florence Capital

Wearing a startup enabler lens, what is noteworthy is the mention of technologies ranging across AI, IOT, Blockchain and Digital across core sectors of the economy. India @ 75 is setting up a massive road map for India @ 100 to be a technology powerhouse in infrastructure, financial services, agriculture and national defense. Setting up a roadmap for adoption of CBDC and making digital and fintech as the priority of the Gov’t stands out in the Budget 2022 announcement. Allocation of INR 1,500 Crores for development initiatives in the North East is another big one, that should see the startup ecosystem grow in the region

Ajay Ramasubramaniam, Co-Founder & CEO, Startup Reseau

This budget shows that technology enablement for transparency and roll-out at scale remains at the heart of the Government. Every aspect of the Budget speech has this aspect in mind. At the macro level, this tech enablement as an integral part of governance will be a boost for all new age tech companies and would further enhance the environment of new age digital and tech companies. Drones have now become an Integral part of the implementation of schemes be it in agritech, in defence and other areas. Creation of Nabard Agritech Fund for “Kisan Drones “ shows the Government recognition of a new view on how to upgrade the farming. Recognition of digital assets and bringing them under the tax structure is an excellent initiative as this would bring these in the mainstream. The tax on crypto/ NFTs will now make it legalised and users won’t be able to circumvent tax and other financial regularities. In addition to this, Defence, Artificial Intelligence (AI), geospatial systems, drones, space economy, genomics & pharmaceuticals and clean mobility have immense potential to achieve sustainable development and offer employment to millions. The government will enable development in these sectors through the startup community.This is a long term directional growth budget and can be called the “digital future growth budget”

Bhaskar Majumdar, Managing Partner, Unicorn India Ventures 

This is the Big Tech Push budget- A recognition of breakthrough tech and all that it contributes to the growing digital consumption economy. Nocode tech platforms like Kappa that democratise tech for a larger mass can help the larger population  become more tech savvy in a shorter time, creating new employment opportunities.Further, we see many opportunities esp with humanisation of assets that can help small businesses grow exponentially in building duniya ki apni dukan without a significant expense in infrastructure.

Prashanto Das, Founder, Hyperstate Technologies

Agriculture, healthcare, and digital banking have all received significant boosts in the Budget 2022-23. India has seen a surge in startups, particularly in the IT/knowledge-based sectors, over the last six years. The one-year extension of tax incentives for startups, as well as the launch of the e-stack portal, which encourages a digital ecosystem for skilling and finding relevant jobs and entrepreneurial opportunities, will encourage a stronger entrepreneurial culture in India and position India as the global hub for technological innovation. The FM stated that startups will be encouraged to facilitate drones by developing various applications and providing drones as a service. The allocation of 25% of India’s defence R&D budget to private industry, startups, and academia is a positive step. The FM also mentioned formalising cryptocurrency, 30% tax on income from transfer of virtual digital assets, and announcement of a blockchain-based and RBI-backed Central Bank Digital Currency (CBDC). With tech advancement, innovation and widespread adoption of digital payments, the government should also focus on raising awareness and education around the importance of cybersecurity, privacy and data security among businesses and consumers for sustainable growth.

Pankit Desai, Co-founder CEO, Sequretek, a Mumbai-based cyber security startup

“While some of the bitcoin and other crypto asset investors might be disappointed with the 30% tax, the silver lining is that the government has taken a nuanced view around it and recognised digital assets as part of the evolving future – making it illegal and driving it underground would’ve done this asset class more harm”. 

Mr. Vivek Saxena, CEO & Co- Founder, Thinkly

The domestic furniture market has grown at a CAGR of 10-11% in the last 5 years. Yet, 80% of this market remains unorganised. With the focus on increasing consumption and capital expenditure that this budget has brought in, furniture manufacturers who are focused on ‘Make in India’ can expect to increase their organised market base, bring economies of scale and in turn make themselves cost competitive for the international export market as well

Neha Indoria, Co-founder & CEO, Boingg!

The budget truly echoes India’s vision towards inclusive development and building a truly ‘Atmanirbhar Bharat’ by providing a blueprint for the economy over ‘Amrit Kal’ from India at 75 to India at 100. FM’s key announcements on blockchain and setting up e-passports with futuristic technologies are a step in the right direction to help India emerge as a global technology leader. The focus on innovation and R&D (Research and Development) with an emphasis on strengthening talent capacity through STEM (Science, Technology, Engineering, Mathematics) universities and skilling courses in IIT’s will enable India to become a global hub for skilled talent. Overall, Budget 2022 promises to provide the much-needed impetus to sustain India’s economic and digital growth.”

CP Gurnani, MD & CEO, Tech Mahindra

The emphasis on growth, digitization and being future ready outlines the government’s commitment to cohesive development and ‘Make in India’. Focus on Gati Shakti masterplan, youth, women, job creation, technology and infrastructure development among others will drive India’s Amrit Kal, journey from 75 to 100 years as a democracy. India has the potential to be a world-class infrastructure centre, and the Budget has provided enough impetus to propel the same. In addition, we expect the digital ecosystem for skilling will boost human capital and empower industries significantly.

Rajiv Bhalla, MD, Barco India

The industry has been completely galvanized under the pioneering initiative of PLI scheme, with Hon’ble FM today stating that it has potential to create 60 Lakh new jobs and additional production of 30 lakh crores. This is also a clarion call to the industry to work much harder in the years to come to make it a reality.  On a macro level, the scheme around design-led manufacturing as part of the PLI scheme would fasten the development of the ecosystem, and also changes in customs duty will drive greater domestic value addition in Electronics manufacturing in the country, which has grown rapidly in the last few years.”

Mr. A Gururaj, MD, Optiemus Electronics Ltd 

Union Budget 2022 has announced the PM Gati Shakti program as one of the priority areas of the government. Seven engines of the PM Gati Shakti initiative are roads, railways, airports, ports, mass transport, waterways and logistics infra. As the Indian economy moves towards strengthening these initiatives, geospatial technology will gain more prominence in the process. As shared by the Hon’ble Finance Minister, the Gati Shakti program would involve huge investments in construction of about 25,000 Kms of highways, multimodal transport, and modernization of land records. These are welcome steps, and GIS and other geospatial technologies will facilitate efficient implementation of these schemes. With the launch of Jal Jeevan Mission (Urban), the government is aiming at universal water supply in all 4,378 Urban Local Bodies with 2.86 crores household tap connections, as well as liquid waste management in 500 AMRUT cities. GIS based water distribution network planning, execution and operations will go a long way in bringing these plans to fruition more quickly and efficiently.”

Agendra Kumar, Managing Director, Esri India

Budget 2022 gave a major and much needed thrust to digital skilling with initiatives like Digital DESH. Emphasis on a digital ecosystem for skilling and livelihood points to the much-needed market oriented digital skills development”.

Vikram Kumar, Co-founder, MyTat( Skilling Startup) 

It has been the industry’s request for some time to bring digital assets and currency in the regulatory framework and it is heartening to note that the Hon’ble FM and Hon’ble PM have recognised the sector. Taxation and TDS on Digital Assets have come as a sudden move for the industry. It might hit user sentiments in the short term; however, we shall see how the ecosystem evolves in the country and are committed to work as per the rule of the land.

 Arun Pandey, Co-founder,

The budget paves a way for digital savvy India, impacting betterment and quality of life and ease of doing business. The Budget 2022 brings super positive news for the Web3.0 Startup ecosystem in India and brings a long term direction. Blockchain Innovations companies have exposure to Cryptocurrencies and this decision by the Government of India will help such core tech innovation to flourish without any fear. The Indian Government legitimatised crypto assets in India in an indirect way by coming out to tax the same. This is a strong step taken to boost a digital economy.

DigitalRupee is a historical decision by the visionary GoI. This will give a boost to the economy and create increased digital financial participation among the youth. India’s Digital currency will bring about an efficient, credible, payments option. It will also reduce dependency on cash, and increase cheaper currency management system in the long run.

We welcome this move and laud the vision of the Finance Ministry which will take India way ahead.”

Toshendra Sharma, Founder and CEO, NFTically

With this budget, investors at large were hoping to see an update on Crypto and other digital assets. The introduction of ‘Digital Rupee’ goes on to show the acceptance of digital currency and digital assets nation-wide, and provides a pathway for India to play a more proactive role in the international financial arena. With clarity on the taxation implications on digital assets, it is now set to go mainstream. Coupled with the Government’s efforts to boost the overall fintech ecosystem in this Budget by promoting economical and user-friendly payment platforms, this will definitely provide a fillip to making India a fintech powerhouse.”

Raghunandan G, Founder & CEO,  Zolve 

The budget is a blend between a welfare and a reformist budget. It is a delight to see the announcement of National Tele Mental Health Programme. A step forward for tackling issues less talked about. This gives me hope, that soon enough, govt will also recognise the challenges specifically faced by the older adults. Certain state govts have already supported and recognised the plight of the elders of the country. Further, with initiatives like Ease of Doing Business 2.0 with One nation One registration and PM GatiShakti, we can see the commitment of the govt to work towards the issues faced by businesses and start ups specifically.

Tapan Mishra, Founder, Seniority & Evergreen Club

Glad to see the government of India recognising and making Natural and Organic farming as an important part. Where Kisan drone, digitalisation of land and allied technology will help in better yield and more conversions from traditional to chemical free and organic farming, the inclusions of a NABARD based capital finance option will help young startups like us to grow. In addition to this the national logistics and supply chain program GATI SHAKTI, will help us reach consumers faster with fresh produce.  Year 2023 will be the year for clean eating and this vision of our Hon. PM to take this globally.

Dharmishtha Goenka, Founder of Praakritik

It is heartening to hear that India’s growth estimated to be at 9.2%, highest among all large economies. We are now in a strong position to withstand challenges as the Hon. Finance minister states. While it is a growth oriented budget, there is no big bang announcement for any sector including hospitality. This sector is still recovering and has some way to go. Although the credit guarantee scheme does provide some assurance of keeping the MSME hospitality sector afloat, we had hoped for tax breaks and a more holistic support system to enable growth for this specific industry.

Teja Chekuri, Managing Partner, Ironhill India

The 2022 Budget saw many missed expectations for SMEs and Start-ups. As one of the fastest growing contributors to GDP, the SaaS sector should be promoted more by the central government. Share allocation process for start-ups to be simplified. Low cost tech education in Tier 3 and smaller towns is a huge must, as supply of skilled tech workers is at an all time low compared to demand. Getting government contracts for tech start-ups is still very complicated and should be made easier. Labour Law reforms for tech companies would be appreciated too. The govt needs to stand behind Indian SaaS companies to make India the no. 1 SaaS exporter in the world. Hopefully we will see some of this in next year’s budget

Mr. Arjun Gupta, Founder, Courseplay says,

Budget 2022 has laid a strong emphasis on promoting digital and technological innovations across sectors. The three identified focus areas of technology led development, energy transition and climate action will create a conducive environment for deep tech innovators operating at the intersection of technology and energy to flourish in the country. An allocation of Rs 19,500 crores towards solar energy PLI schemes will spur large-scale demand for the next level of stationary-energy-storage capacities. This will unravel an entirely new ecosystem comprising of battery technology innovators, energy storage platforms, as well as manufacturers and service providers across the energy value chain. At Offgrid Energy, we are particularly excited at prospects unfolding for deep tech companies in the energy storage space.

Tejas Kusurkar, Co-founder and CEO, Offgrid Energy Labs

“This Budget proposal enables India to make digital progress across sectors and contributes to creating a digital, tech-enabled ecosystem. With the launch of the Digital DESL Stack portal the government will empower the Indian youth to attain more relevant jobs, entrepreneurial opportunities and help them to upskill through online training. I believe start-ups will contribute greatly to the Government’s mission of driving job creation across the skill spectrum. Also, the introduction of Digital currency through use of blockchain technology in 2023, will make money management easier than ever”

Mr. Nilesh Patel, CEO and Founder of Leadsquared 

Budget 2022 has brought some really interesting updates. We are stepping into the new India, the India of startups. We have grown to a community of over 61400 startups which have created more than 6 lacs jobs for our people. The government has recognised that India has achieved the product-market fit for startups. From being home to 733 startups 5 years back to having over 14000 startups in 2021 alone, we are growing massively and multiplying quickly. Make in India is thriving and our startup ecosystem is a prime example of that.

Another interesting highlight is that the investment in enhancing transport infrastructure will really help the e-commerce space as logistics continue to be one of the biggest spends for the industry and is comparatively much higher than other nations. Enhancing transportation infrastructure will optimize the shipping process and save cost burdens for the e-commerce industry.

Apart from these, data centres have now been awarded the infrastructural status. This is a very progressive move as development and financing will become smoother. As this evolves, India will soon become the global data centre and we are extremely excited to see that happening. Oh and also, our government is recognising crypto. So yes, all in all, a good day for the Indian citizens.

– Chirag Taneja, Co-Founder and CEO at GoKwik

I couldn’t be more delighted to see that two major keywords made the whole backbone of  #UnionBudget2022 Rural India i.e. The Real Bharat and Startups. We’re so glad to be a part of this movement and to be present at the center to mobilize the youth from Tier 2, 3 & 4 cities for 60 Lac jobs and empower rural India. This budget has proved once again that the Modi Government is dedicated towards unleashing the power of the Rural economy and focusing on Bharat. Startups and Rural India is a combination that’s going to contribute massively for the $5 Trillion vision in the upcoming years.

It is interesting to see great focus being laid on The Production-Linked Incentive (PLI) scheme’s potential to generate at least 60 lakhs new job opportunities across a wide spectrum of sectors. More emphasis on technologies like deeptech, agritech, EV tech, defence & digital payments is also a positive sign for tech startups.

Mr. Rahul Veerwal, Founder & CEO, GetWork

  1. Ease of doing & sustaining a fledgling business is a major facet of making India an entrepreneurial and commercial hub. ‘One nation, one registration’ is a massive step towards this. Easing the system of taxation including the two year ITR window, reducing the tax burden of co-operative societies, and extending tax holiday for startups is a positive move.
  2. Job generation continues to be a priority. The 60 lakh new jobs under Make in India and the emphasis on Agri & IT startups are welcome moves. With right execution, these could go a long way in fostering mass entrepreneurship in the new age products and solutions for both domestic and international markets.
  3. Digitization agenda is gaining momentum. Multiple steps to promote renewable energy sources such as targeting the increase in EV battery production or creating business models for battery & energy as a service, and steps to create more digital banking units are examples in this direction.
  4. The Education sector and its reforms are critical to our ability to build out the young talent for the digital future. Steps such as digital universities are a big step towards this.
  5. Ease of doing business especially across borders requires massive steps in making our policies explicit and transparent. One of the interesting steps in this is the clear taxation policy on virtual digital assets. Crypto-based transactions are an essential aspect of the future, it is vital for the government to announce its position on this aspect of business. 

Post-pandemic, there has been a massive acceleration in digital transformation initiatives across the world. While India has also had its share of these initiatives, we have a much bigger opportunity to serve these initiatives across the world through our export of technology services and deployment of technology products. India must move fast to capitalise and consolidate its leadership position in IT services and gain a stronger foothold in building market share in the technology products. An ideal vision is to make India a trillion dollar software exporter (services, products, platforms) by 2035.

The Union budget 2022 gives us a window into the government’s thinking in this direction. Let us take a look at a few of the announcements that may aid this vision.

Mr. Hariraj Vijayakumar, Founder, NWORX

“The overall budget seemed very growth-oriented in terms of boosting logistics and supply chain industry in India with PM Gati Shakti Master Plan. The plan will help in cutting logistic costs, increase cargo handling capacity and reduce the turnaround time, further fastening and smoothening the supply chain of goods. Currently, logistics and supply chain expenses represent 12 to 13 percent of GDP, compared to an international average of 8%. With Gati Shakti, India will gain a foothold in the construction of an integrated, harmonized transportation and logistics grid with Gati Shakti.”

Sumit Sharma, Co-Founder, GoBOLT
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