Indian IT industry expectation from Narendra Modi government

The Indian IT sector contributes around 8 percent to the country’s GDP and has got huge potential to grow, but lags behind in the absence of proper policies and regulatory framework. The Narendra Modi government can contribute too much to Indian IT.

The BJP manifesto has given special focus on utilizing IT for improving living conditions and productivity of Indians. But the implementation of a manifesto needs strong support from state governments as well. Majority state governments are not governed by BJP.

As the new Telecom and IT Minister Ravi Shankar Prasad turns to his office, the industry calls for domestic manufacturing, policy reforms, increased investment and putting India in the global map and a proper ecosystem.

ESDM: From an industry perspective, the ESDM (Electronics Design and Manufacturing) ecosystem is a huge opportunity for India. Despite having a huge talent pool, India still lags behind other Asian countries on the manufacturing front because of challenges related to sourcing/availability of components at right prices.

“The new government should take steps to promote electronic manufacturing in India, helping promoters to build manufacturing capacity and attract foreign investment to this sector. Besides, it would help create huge employment opportunities,” said Mrinmoy Purkayastha, VP Marketing, Calsoft Labs.

Even electronic manufacturing requires entrepreneurship hubs and incubation centers for IP creation. Therefore, steps to build local fabless and start-up culture should be there to support them.

“With its large, highly skilled workforce and robust investment in research and development, India is well-positioned to be a global leader in technology innovation,” said BSA President and CEO Victoria Espinel.

Besides, investment should be made in hardware engineering and semiconductor capabilities by offering incentives that will create upward and downward innovation opportunities for IT Industry.

Indian IT sector


The industry also demands removal of inverted duty structure, eliminating complex tax structure that would boost investment into the country. According to industry body MAIT, inverted duty structure makes domestically manufactured goods uncompetitive. The new government should look at exemption of SAD on all components used by the IT manufacturer.

Software Exports/Imports:

The IT sector often faces the challenge of software exports and imports due to exchange rate variations. Therefore, the Exchange Rate Variation clause for all IT hardware product purchase contracts, notwithstanding delivery period under the General Finance Rules (GFR), 2005, should be amended.

Taking India in Global Map:

The industry feels that removal of complex tax structure, increased government spending in IT and reforms will put India in the global map.

“Till date, no major IT company in the league of a Microsoft, Oracle, Google or Whats App has seen the light of day from India. There is no dearth of talent in India, what is missing is the ecosystem to nurture these types of companies,” said Rohil Sharma, CEO, Perpetuuiti.

Espinel adds that “there is an opportunity to continue improving India’s regulatory and policy framework for cloud computing, data analytics and other major drivers of growth throughout the IT economy, all these will help India to make a global footprint.”

Leeway in handling social media:

The rising usage of internet, social media is raising questions related to governing the internet. Currently, stringent laws related to online content discourages businesses. So, laws should be relaxed in order to infuse confidence into the sector. Besides,  a multi-stakeholder framework for internet governance is the need of the hour, comprising government, business, civil society, academia, media, etc.

The Indian IT industry would welcome steps like subsidies for increased PC penetration, software-driven innovation, etc.

Krishna Mukherjee